File Nos. 333-
811-05618
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 (X)
Pre-Effective Amendment No. ( )
Post-Effective Amendment No. ( )
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 ( )
Amendment No. 72 (X)
(Check appropriate box or boxes.)
ALLIANZ LIFE VARIABLE ACCOUNT B
-------------------------------
(Exact Name of Registrant)
ALLIANZ LIFE INSURANCE COMPANY OF NORTH AMERICA
-----------------------------------------------
(Name of Depositor)
1750 Hennepin Avenue, Minneapolis, MN 55403
------------------------------------------- -----
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612) 347-6596
Name and Address of Agent for Service
-------------------------------------
Suzanne J. Pepin
Allianz Life Insurance Company of North America
1750 Hennepin Avenue
Minneapolis, MN 55403
Copies to:
Judith A. Hasenauer
Blazzard, Grodd & Hasenauer, P.C.
P.O. Box 5108
Westport, CT 06881
(203) 226-7866
Approximate Date of Proposed Public Offering:
As soon as practicable after the effective date of this Filing.
Title of Securities Registered:
Individual Deferred Variable Annuity Contracts
================================================================================
The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall file
a further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
CROSS REFERENCE SHEET
(Required by Rule 495)
<TABLE>
<CAPTION>
<S> <C> <C>
Item No. Location
-------- -----------------------
PART A
Item 1. Cover Page . . . . . . . . . . . . . . . . . Cover Page
Item 2. Definitions . . . . . . . . . . . . . . . . Index of Terms
Item 3. Synopsis or Highlights. . . . . . . . . . . Highlights
Item 4. Condensed Financial Information. . . . . . . Appendix-Condensed
Financial Information
Item 5. General Description of Registrant, Depositor,
and Portfolio Companies. . . . . . . . . . . . Other Information-
The Separate Account,
Allianz Life,
Investment Options
Item 6. Deductions. . . . . . . . .. . . . . . . . . . Expenses
Item 7. General Description of Variable
Annuity Contracts . . . . . . . . . . . . . . .The Valuemark IV
Variable Annuity
Contract
Item 8. Annuity Period. . .. . . . . . . . . . . . . . Annuity Payments
(The Payout Phase)
Item 9. Death Benefit. . . . . . . . . . . . . . . . . Death Benefit
Item 10. Purchases and Contract Value. . . . . . . . . .Purchase
Item 11. Redemptions. . . . . . . . . . . . . . . . . . Access to Your Money
Item 12. Taxes. . . . . . . . . . . . . . . . . . . . . Taxes
Item 13. Legal Proceedings. . . . . . . . . . . . . . . None
Item 14. Table of Contents of the Statement of
Additional Information. . . . . . . . . . . Table of Contents
of the Statement of
Additional Information
</TABLE>
CROSS REFERENCE SHEET (cont'd)
(Required by Rule 495)
<TABLE>
<CAPTION>
<S> <C> <C>
Item No. Location
-------- --------------------
PART B
Item 15. Cover Page. . . . . . . . .. . . . . . . . Cover Page
Item 16. Table of Contents. . . . . . . . . . . . . Table of Contents
Item 17. General Information and History. . . . . . Insurance Company
Item 18. Services. . . . . . . . . . . . .. . . . . Not Applicable
Item 19. Purchase of Securities Being Offered. . . . Not Applicable
Item 20. Underwriters. . . . . . . . . . . . . . . . Distributor
Item 21. Calculation of Performance Data. . . . . . Calculation of
Performance Data
Item 22. Annuity Payments. . . . . . . . . . . . . . Annuity Provisions
Item 23. Financial Statements. . . . . . . . . . . Financial Statements
</TABLE>
PART C
Information required to be included in Part C is set forth under the appropriate
Item so numbered, in Part C to this Registration Statement.
<PAGE>
PART A
THE VALUEMARK(R) IV VARIABLE ANNUITY CONTRACT
issued by
ALLIANZ LIFE VARIABLE ACCOUNT B
and
ALLIANZ LIFE INSURANCE COMPANY OF NORTH AMERICA
This prospectus describes the Valuemark IV Variable Annuity Contract with a
Fixed Account offered by Allianz Life Insurance Company of North America
(Allianz Life). All references to "we," "us" and "our" refer to Allianz Life.
The annuity offers the Variable Options listed below, and a Fixed Account of
Allianz Life. Each Variable Option invests in a Portfolio listed below. You can
select up to 10 investment options (which includes any of the Variable Options
and the Fixed Account). The Fixed Account and one or more of the Variable
Options may not be available in your state.
VARIABLE OPTIONS:
AIM VARIABLE INSURANCE FUNDS:
AIM V.I. Growth Fund
THE ALGER AMERICAN FUND:
Alger American Growth Portfolio
Alger American Leveraged AllCap Portfolio
FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST#:
Franklin Aggressive Growth Securities Fund
Franklin Global Communications Securities Fund*
Franklin Global Health Care Securities Fund
Franklin Growth and Income Securities Fund*
Franklin High Income Fund
Franklin Income Securities Fund
Franklin Large Cap Growth Securities Fund*
Franklin Money Market Fund
Franklin Natural Resources Securities Fund
Franklin Real Estate Fund*
Franklin Rising Dividends Securities Fund*
Franklin S&P 500 Index Fund
Franklin Small Cap Fund
Franklin Technology Securities Fund
Franklin U.S. Government Fund*
Franklin Value Securities Fund
Franklin Zero Coupon Funds - 2000, 2005 and 2010
Mutual Discovery Securities Fund
Mutual Shares Securities Fund
Templeton Asset Strategy Fund*
Templeton Developing Markets Securities Fund*
Templeton Global Income Securities Fund
Templeton Growth Securities Fund*
Templeton International Securities Fund*
Templeton International Smaller Companies Fund
Templeton Pacific Growth Securities Fund*
#Effective May 1, 2000, the funds of Templeton Variable Products Series Fund
were merged into similar funds of Franklin Templeton Variable Insurance Products
Trust.
USALLIANZ VARIABLE INSURANCE PRODUCTS TRUST:
USAllianz VIP Diversified Assets Fund
USAllianz VIP Fixed Income Fund
USAllianz VIP Growth Fund
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
*The fund's name changed as follows:
CURRENT NAME PREVIOUS NAME
-----------------------------------------------------------------------------------------
<S> <C>
Franklin Global Communications Securities Fund Franklin Global Utilities Securities Fund
Franklin Growth and Income Securities Fund Franklin Growth and Income Fund
Franklin Large Cap Growth Securities Fund Franklin Capital Growth Fund
Franklin Real Estate Fund Franklin Real Estate Securities Fund
Franklin Rising Dividends Securities Fund Franklin Rising Dividends Fund
Franklin U.S. Government Fund Franklin U.S. Government Securities Fund
Templeton Asset Strategy Fund Templeton Global Asset Allocation Fund
Templeton Developing Markets Securities Fund Templeton Developing Markets Equity Fund
Templeton Growth Securities Fund Templeton Global Growth Fund
Templeton International Securities Fund Templeton International Equity Fund
Templeton Pacific Growth Securities Fund Templeton Pacific Growth Fund
</TABLE>
A bonus is optional with this Contract. If you select a bonus, the expenses for
the Contract may be higher than expenses for a Contract without a bonus. The
amount of the bonus may be offset by any additional fees and/or charges
associated with the bonus.
Please read this prospectus before investing and keep it for future reference.
It contains important information about the Valuemark IV Variable Annuity
Contract with a Fixed Account.
To learn more about the annuity offered by this prospectus, you can obtain a
copy of the Statement of Additional Information (SAI) dated ___________. The SAI
has been filed with the Securities and Exchange Commission (SEC) and is legally
a part of this prospectus. The Table of Contents of the SAI is on page __ of
this prospectus. The SEC maintains a Web site (http://www.sec.gov) that contains
the SAI, material incorporated by reference and other information about
companies that file electronically with the SEC. For a free copy of the SAI,
call us at 1-800-542-5427 or write us at: 1750 Hennepin Avenue, Minneapolis,
Minnesota 55403-2195.
THE VALUEMARK IV VARIABLE ANNUITY CONTRACTS:
O ARE NOT BANK DEPOSITS
O ARE NOT FEDERALLY INSURED
O ARE NOT ENDORSED BY ANY BANK OR GOVERNMENT AGENCY
O ARE NOT GUARANTEED AND MAY BE SUBJECT TO LOSS OF PRINCIPAL
This prospectus is not an offering of the securities in any state, country, or
jurisdiction in which we are not authorized to sell the Contracts. You should
rely only on the information contained in this prospectus or that we have
referred you to. We have not authorized anyone to provide you with information
that is different.
Dated: ___________, 2000
Variable Annuity Prospectus
TABLE OF CONTENTS
Index of Terms
Highlights
Fee Table
1. The Valuemark IV Variable Annuity Contract
Contract Owner
Joint Owner
Annuitant
Beneficiary
Assignment
2. Annuity Payments (The Payout Phase)
Income Date
Annuity Payments
Guaranteed Minimum Income Benefits
Annuity Options
3. Purchase
Purchase Payments
Automatic Investment Plan
Bonuses
Allocation of Purchase Payments
Free Look
Accumulation Units
4. Investment Options
Transfers
Dollar Cost Averaging Program
Flexible Rebalancing
Voting Privileges
Substitution
5. Expenses
Insurance Charges
Mortality and Expense Risk Charge
Administrative Charge
Contract Maintenance Charge
Contingent Deferred Sales Charge
Waiver of Contingent Deferred
Sales Charge Benefits
Reduction or Elimination of the
Contingent Deferred Sales Charge
Transfer Fee
Premium Taxes
Income Taxes
Portfolio Expenses
6. Taxes
Annuity Contracts in General
Qualified and Non-Qualified Contracts
Multiple Contracts
Withdrawals - Non-Qualified Contracts
Withdrawals - Qualified Contracts
Withdrawals - Tax-Sheltered Annuities
Diversification
7. Access to Your Money
Systematic Withdrawal Program
Minimum Distribution Program
Suspension of Payments or Transfers
8. Performance
9. Death Benefit
Upon Your Death
Death of Annuitant
10. Other Information
Allianz Life
The Separate Account
Distribution
Administration
Financial Statements
Table of Contents of the
Statement of Additional Information
Appendix
INDEX OF TERMS
--------------------------------------------------------------------------------
This prospectus is written in plain English to make it as understandable as
possible. However, there are some technical terms used which are capitalized in
the prospectus. The page that is indicated below is where you will find the
definition for the word or term.
Page
Accumulation Phase
Accumulation Unit
Annuitant
Annuity Options
Annuity Payments
Annuity Unit
Beneficiary
Contract
Contract Owner
Fixed Account
Income Date
Joint Owner
Non-Qualified .
Payout Phase
Portfolios
Purchase Payment
Qualified
Tax Deferral
Variable Option
HIGHLIGHTS
The variable annuity contract offered by Allianz Life is a contract between you,
the owner, and Allianz Life, the insurance company. The Contract provides a
means for investing on a tax-deferred basis in Variable Options and the Allianz
Life Fixed Account for retirement savings or other long-term investment
purposes. The Contract provides two death benefit options and guaranteed annuity
income options.
If you purchase the Contract on or after _________, 2000, you can select the
Immediate Bonus and/or the Loyalty Bonus. If you select the Immediate Bonus,
Allianz Life will credit each Purchase Payment you make, within the first six
months after it issues the Contract, with a 3.5% Bonus. If you select the
Loyalty Bonus, Allianz Life will credit your Contract on the 7th Contract
anniversary with a Bonus equal to 3.25% of your Contract value. Under certain
circumstances, Allianz Life may take back the Bonus amounts.
All deferred annuity contracts, like this Contract, have two phases: the
Accumulation Phase and the Payout Phase. During the Accumulation Phase, earnings
accumulate on a tax-deferred basis and are taxed as ordinary income when you
make a withdrawal. If you make a withdrawal during the Accumulation Phase,
Allianz Life may assess a contingent deferred sales charge which varies
depending upon how long it has had your Purchase Payment and whether or not you
select the Immediate Bonus. The Payout Phase occurs when you begin receiving
regular Annuity Payments from your Contract.
You can choose to receive Annuity Payments on a variable basis, on a fixed basis
or a combination of both. If you choose variable payments, the amount of the
variable annuity payments will depend upon the investment performance of the
Variable Options you select for the Payout Phase. If you choose fixed payments,
the amount of the fixed annuity payments are constant for the entire Payout
Phase. If you purchase the Contract on or after _________, 2000, you can select
a guaranteed minimum income benefit (GMIB).
FREE LOOK. You can cancel the Contract within 10 days after receiving it
(or whatever period is required in your state). Allianz Life will refund the
value of your Contract on the day it receives your request to cancel the
Contract. This may be more or less than your original payment. In certain
states, or if you have purchased the Contract as an individual retirement
annuity, Allianz Life will refund the Purchase Payment. If you select the
Immediate Bonus, Allianz Life will take back the Bonus amount if you cancel the
Contract under this free look provision.
TAX PENALTY. Your earnings are not taxed until you take them out. If you
take money out during the Accumulation Phase, earnings come out first and are
taxed as income. If you are younger than 59 1/2 when you take money out, you may
be charged a 10% federal tax penalty. For tax purposes, bonuses are considered
to be earnings.
INQUIRIES. If you have any questions about your Contract or need more
information, please contact us at:
USAllianz Service Center
300 Berwyn Park
P.O. Box 3031
Berwyn,PA 19312-0031
1-800-624-0197
FEE TABLE
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The purpose of this Fee Table is to help you understand the costs of investing,
directly or indirectly, in the Variable Options under the Contract. It reflects
expenses of the Separate Account as well as the Portfolios.
CONTRACT OWNER TRANSACTION FEES
Contingent Deferred Sales Charge ("CDSC")*
(as a percentage of Purchase Payments)
YEARS SINCE CONTRACTS WITHOUT CONTRACTS WITH
PURCHASE PAYMENT IMMEDIATE BONUS IMMEDIATE BONUS
CDSC CHARGE CDSC CHARGE
-------------------------------------------------------------------------
0-1 6% 9.5%
1-2 6% 9.5%
2-3 6% 9.0%
3-4 5% 7.5%
4-5 4% 6.0%
5-6 3% 4.5%
6-7 2% 3.0%
7 + 0% 0%
Transfer Fee First 12 transfers in a Contract year are free. Thereafter, the
fee is $25 or 2% of the amount transferred, if less. Dollar Cost
Averaging transfers and Flexible Rebalancing transfers are not
currently counted.
CONTRACT MAINTENANCE CHARGE** $30 per Contract per year
SEPARATE ACCOUNT ANNUAL EXPENSES
(as a percentage of average account value)
<TABLE>
<CAPTION>
Charges for Contract with
Charges for GMIB and Immediate and
Standard Contract Loyalty Bonuses
----------------- ----------------------
<S> <C> <C>
Mortality and Expense Risk Charge*** 1.34% 2.14%
Administrative Charge .15% .15%
------ -----
Total Separate Account Annual Expenses 1.49% 2.29%
</TABLE>
* Each year after the first Contract year, you may make multiple partial
withdrawals of up to a total of 15% of the value of your Contract and no
contingent deferred sales charge will be assessed. See Section 7 -- "Access to
Your Money" for additional options.
** During the Accumulation Phase, the charge is waived if the value of your
Contract is at least $50,000. If you own more than one Valuemark IV Contract
(registered with the same social security number), we will determine the total
value of all your Contracts. If the total value of all your Contracts is at
least $50,000, the charge is waived (except in New Jersey). Currently, the
charge is also waived during the Payout Phase if the value of your Contract at
the Income Date is at least $50,000 (except in New Jersey).
*** The amount of the mortality and expense risk charge during the Accumulation
Phase depends upon whether you select a Bonus and/or a guaranteed minimum income
benefit (GMIB) and the Contract year your Contract is in. The lowest charge
shown in the table above assumes you do not select any Bonus or GMIB. The
highest charge shown in the table above assumes you choose both Bonus Options
and the GMIB. The mortality and expense risk charge will be different for your
Contract if you choose only one of these options or a different combination of
options. See "Expenses - Mortality and Expense Risk Charge" for more
information. The mortality and expense risk charge is 1.25% during the Payout
Phase regardless of any Bonus or GMIB benefits you have selected.
<PAGE>
7
<TABLE>
<CAPTION>
FUND ANNUAL EXPENSES:
(as a percentage of the Portfolio's average net assets for the most recent
fiscal year). See the accompanying Portfolio prospectuses for more information.
MANAGEMENT
AND PORTFOLIO TOTAL ANNUAL
ADMINISTRATIVE FEES1 12b-1 FEES OTHER EXPENSES EXPENSES
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AIM V.I. Growth Fund .63% -- .10% .73%
Alger American Growth Portfolio .75% -- .04% .79%
Alger American Leveraged AllCap Portfolio2 .85% -- .08% .93%
Franklin Aggressive Growth Securities Fund,
Class 1 3 .50% -- .22% .72%
Franklin Global Communications Securities Fund,
Class 1 .48% -- .03% .51%
Franklin Global Health Care Securities Fund, Class 1 .60% -- .22% .82%
Franklin Growth and Income Securities Fund, Class 1 .47% -- .02% .49%
Franklin High Income Fund, Class 1 .51% -- .03% .54%
Franklin Income Securities Fund, Class 1 .48% -- .02% .50%
Franklin Large Cap Growth Securities Fund, Class 1 4 .75% -- .02% .77%
Franklin Money Market Fund, Class 1 .52% -- .01% .53%
Franklin Natural Resources Securities Fund, Class 1 .62% -- .04% .66%
Franklin Real Estate Fund, Class 1 .56% -- .02% .58%
Franklin Rising Dividends Securities Fund, Class 1 .73% -- .02% .75%
Franklin S&P 500 Index Fund, Class 1 5 .15% -- .38% .53%
Franklin Small Cap Fund, Class 1 6 .55% -- .27% .82%
Franklin Technology Securities Fund, Class 1 3 .55% -- .38% .93%
Franklin U.S. Government Fund, Class 1 .49% -- .02% .51%
Franklin Value Securities Fund, Class 1 .60% -- .21% .81%
Franklin Zero Coupon Fund, Class 1 - 2000 .63% -- .02% .65%
Franklin Zero Coupon Fund, Class 1 - 2005 .63% -- .02% .65%
Franklin Zero Coupon Fund, Class 1 - 2010 .63% -- .02% .65%
Mutual Discovery Securities Fund, Class 1 .80% -- .21 1.01%
Mutual Shares Securities Fund, Class 1 4 .60% -- .19% .79%
Templeton Asset Strategy Fund, Class 1 6 .60% -- .18% .78%
Templeton Developing Markets Securities Fund,
Class 1 6 1.25% -- .31% 1.56%
Templeton Global Income Securities Fund, Class 1 4 .60% -- .05% .65%
Templeton Growth Securities Fund, Class 1 4 .83% -- .05% .88%
Templeton International Securities Fund, Class 1 6 .69% -- .19% .88%
Templeton International Smaller Companies Fund,
Class 1 .85% -- .26% 1.11%
Templeton Pacific Growth Securities Fund, Class 1 1.00% -- .08% 1.08%
USAllianz VIP Diversified Assets Fund, Class 1 5/7 .55% .25% .20% 1.00%
USAllianz VIP Fixed Income Fund, Class 1 5/7 .50% .25% .00% .75%
USAllianz VIP Growth Fund, Class 1 5/7 .65% .25% .00% .90%
<FN>
1. The Portfolio Administration Fee is a direct expense for the Franklin
Aggressive Growth Securities Fund the Franklin Global Health Care
Securities Fund, the Franklin S&P Index Fund, the Franklin Small Cap Fund,
the Franklin Technology Securities Fund, the Franklin Value Securities
Fund, the Mutual Discovery Securities Fund, the Mutual Shares Securities
Fund, the Templeton Asset Strategy Fund, the Templeton Developing Markets
Securities Fund, the Templeton International Securities Fund and the
Templeton International Smaller Companies Fund. Other Portfolios of
Franklin Templeton Variable Insurance Products Trust pay for similar
services indirectly through the Management Fee. See the Franklin Templeton
Variable Insurance Products Trust prospectus for further information
regarding these fees.
2. Other expenses for the Alger American Leveraged AllCap Portfolio include
0.01% of interest expense.
3. The Franklin Aggressive Growth Securities Fund and the Franklin Technology
Securities Fund commenced operations on May 1, 2000. The expenses shown
above for these portfolios are therefore estimated for the current fiscal
year.
4. On 2/8/00, a merger and reorganization was approved that combined the fund
with a similar fund of Templeton Variable Products Series Fund, effective
5/1/00. The table shows total expenses based on the fund's assets as of
12/31/99, and not the assets of the combined fund. However, if the table
reflected combined assets, the fund's Management Fees, Other Expenses, and
Total Fund Operating Expenses after 5/1/00 would be estimated as: 0.75%,
0.02%, and 0.77% respectively for the Franklin Large Cap Growth Securities
Fund; 0.60%, 0.19%, and 0.79% respectively for the Mutual Shares Securities
Fund; 0.80%, 0.05%, and 0.85% respectively for the Templeton Growth
Securities Fund; and .0.60%, 0.04%, and 0.64% respectively for the
Templeton Global Income Securities Fund.
5. The Franklin S&P 500 Index Fund, the US Allianz VIP Diversified Assets
Fund, the US Allianz VIP Fixed Income Fund, and the US Allianz VIP Growth
Fund commenced operations on November 12, 1999. The expenses shown above
for these portfolios are therefore estimated for the fund's current fiscal
year.
6. On 2/8/00, shareholders approved a merger and reorganization that combined
the assets of the fund with a similar fund of the Templeton Variable
Products Series Fund, effective 5/1/00. The shareholders of the similar
fund had approved new management fees, which apply to the combined fund
effective 5/1/00. The table shows restated total expenses based on the new
fees and assets of the fund as of 12/31/99, and not the assets of the
combined fund. However, if the table reflected both the new fees and the
combined assets, the fund's Management Fees, Other Expenses, and Total Fund
Operating Expenses after 5/1/00 would be estimated as: 0.55%, 0.27%, and
0.82% respectively for the Franklin Small Cap Fund; 1.25%, 0.29%, and 1.54%
respectively for the Templeton Developing Markets Securities Fund; 0.60%,
0.14%, and 0.74% respectively for the Templeton Asset Strategy Fund; and
0.65%, 0.20%, and 0.85% respectively for the Templeton International
Securities Fund.
7. Certain expenses of the USAllianz VIP Funds have been assumed by the
Adviser. Had those expenses not been assumed, total return would have been
lower and total fund expenses would have been 3.80% for the Diversified
Assets Fund, 3.77% for the Fixed Income Fund, and 3.90% for the Growth
Fund.
</FN>
</TABLE>
<TABLE>
<CAPTION>
EXAMPLES
--------------------------------------------------------------------------------
The expenses for your Contract may be different than those shown in the charts
below depending upon which benefits, or combination of benefits (Bonuses and/or
GMIB), if any, you select.
O The examples below should not be considered a representation of past or
future expenses. Actual expenses may be greater or less than those shown.
O The $30 contract maintenance charge is included in the examples as a
prorated charge of $1. Since the average Contract size is greater than $1,000,
the contract maintenance charge is reduced accordingly.
O Premium taxes are not reflected in the tables. Premium taxes may apply.
O For additional information, see Section 5 -- "Expenses" and the
accompanying fund prospectuses.
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return on your money if you surrender your Contract at the end of each
time period:
a) assuming you do not select any Bonus or GMIB;
b) assuming you select the Immediate Bonus, the Loyalty Bonus and the GMIB.
1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AIM V.I. Growth Fund a) $84 a) $123 a) $158 a) $265
b) $__ b) $___ b) $___ b) $___
Alger American Growth Portfolio a) $84 a) $125 a) $161 a) $272
b) $__ b) $___ b) $___ b) $___
Alger American Leveraged AllCap Portfolio a) $86 a) $129 a) $168 a) $286
b) $__ b) $___ b) $___ b) $___
Franklin Aggressive Growth Securities Fund,
Class 1* a) $83 a) $123 a) $157 a) $264
b) $__ b) $___ b) $___ b) $___
Franklin Global Communications Securities Fund,
Class 1 a) $81 a) $117 a) $147 a) $243
b) $__ b) $___ b) $___ b) $___
Franklin Global Health Care Securities Fund,
Class 1 a) $84 a) $126 a) $163 a) $275
b) $__ b) $___ b) $___ b) $___
Franklin Growth and Income Securities Fund,
Class 1 a) $81 a) $116 a) $146 a) $241
b) $__ b) $___ b) $___ b) $___
Franklin High Income Fund, Class 1 a) $82 a) $118 a) $148 a) $246
b) $__ b) $___ b) $___ b) $___
Franklin Income Securities Fund, Class 1 a) $81 a) $116 a) $146 a) $242
b) $__ b) $___ b) $___ b) $___
Franklin Large Cap Growth Securities Fund, Class 1 a) $84 a) $125 a) $160 a) $270
b) $__ b) $___ b) $___ b) $___
Franklin Money Market Fund, Class 1 a) $82 a) $117 a) $148 a) $245
b) $__ b) $___ b) $___ b) $___
Franklin Natural Resources Securities Fund, Class 1 a) $83 a) $121 a) $154 a) $258
b) $__ b) $___ b) $___ b) $___
Franklin Real Estate Fund, Class 1 a) $82 a) $119 a) $150 a) $250
b) $__ b) $___ b) $___ b) $___
Franklin Rising Dividends Securities Fund, Class 1 a) $84 a) $124 a) $159 a) $267
b) $__ b) $___ b) $___ b) $___
Franklin S&P 500 Index Fund, Class 1* a) $82 a) $117 a) $148 a) $245
b) $__ b) $___ b) $___ b) $___
Franklin Small Cap Fund, Class 1 a) $84 a) $126 a) $163 a) $275
b) $__ b) $___ b) $___ b) $___
Franklin Technology Securities Fund, Class 1* a) $86 a) $129 a) $168 a) $286
b) $__ b) $___ b) $___ b) $___
Franklin U.S. Government Fund, Class 1 a) $81 a) $117 a) $147 a) $243
b) $__ b) $___ b) $___ b) $___
Franklin Value Securities Fund, Class 1 a) $84 a) $126 a) $162 a) $274
b) $__ b) $___ b) $___ b) $___
Franklin Zero Coupon Fund - 2000, Class 1 a) $83 a) $121 a) $154 a) $257
b) $__ b) $___ b) $___ b) $___
Franklin Zero Coupon Fund - 2005, Class 1 a) $83 a) $121 a) $154 a) $257
b) $__ b) $___ b) $___ b) $___
Franklin Zero Coupon Fund - 2010, Class 1 a) $83 a) $121 a) $154 a) $257
b) $__ b) $___ b) $___ b) $___
Mutual Discovery Securities Fund, Class 1 a) $86 a) $132 a) $172 a) $294
b) $__ b) $___ b) $___ b) $___
Mutual Shares Securities Fund, Class 1 a) $84 a) $125 a) $161 a) $272
b) $__ b) $___ b) $___ b) $___
Templeton Asset Strategy Fund, Class 1 a) $84 a) $125 a) $161 a) $271
b) $__ b) $___ b) $___ b) $___
Templeton Developing Markets Securities Fund,
Class 1 a) $92 a) $148 a) $199 a) $346
b) $__ b) $___ b) $___ b) $___
Templeton Global Income Securities Fund, Class 1 a) $82 a) $117 a) $148 a) $245
b) $__ b) $___ b) $___ b) $___
Templeton Growth Securities Fund, Class 1 a) $85 a) $128 a) $166 a) $281
b) $__ b) $___ b) $___ b) $___
Templeton International Securities Fund, Class 1 a) $85 a) $128 a) $166 a) $281
b) $__ b) $___ b) $___ b) $___
Templeton International Smaller Companies Fund,
Class 1 a) $87 a) $135 a) $177 a) $303
b) $__ b) $___ b) $___ b) $___
Templeton Pacific Growth Securities Fund, Class 1 a) $87 a) $134 a) $176 a) $300
b) $__ b) $___ b) $___ b) $___
USAllianz VIP Diversified Assets Fund* a) $84 a) $124 a) $159 a) $267
b) $__ b) $___ b) $___ b) $___
USAllianz VIP Fixed Income Fund* a) $81 a) $116 a) $146 a) $242
b) $__ b) $___ b) $___ b) $___
USAllianz VIP Growth Fund* a) $83 a) $121 a) $154 a) $257
b) $__ b) $___ b) $___ b) $___
<FN>
*Estimated
</FN>
</TABLE>
<TABLE>
<CAPTION>
You would pay the following expenses on a $1,000 investment, assuming a 5%
annual return on your money if your Contract is not surrendered:
a) assuming you do not select any Bonus or GMIB;
b) assuming you select the Immediate Bonus, the Loyalty Bonus and the GMIB.
1 YEAR 3 YEARS 5 YEARS 10 YEARS
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AIM V.I. Growth Fund a) $24 a) $72 a) $124 a) $265
b) $__ b) $___ b) $___ b) $___
Alger American Growth Portfolio a) $24 a) $74 a) $127 a) $272
b) $__ b) $___ b) $___ b) $___
Alger American Leveraged AllCap Portfolio a) $26 a) $78 a) $134 a) $286
b) $__ b) $___ b) $___ b) $___
Franklin Aggressive Growth Securities Fund,
Class 1* a) $23 a) $72 a) $123 a) $264
b) $__ b) $___ b) $___ b) $___
Franklin Global Communications Securities Fund,
Class 1 a) $21 a) $66 a) $113 a) $243
b) $__ b) $___ b) $___ b) $___
Franklin Global Health Care Securities Fund,
Class 1 a) $24 a) $75 a) $129 a) $275
b) $__ b) $___ b) $___ b) $___
Franklin Growth and Income Securities Fund, Class 1 a) $21 a) $65 a) $112 a) $241
b) $__ b) $___ b) $___ b) $___
Franklin High Income Fund, Class 1 a) $22 a) $67 a) $114 a) $246
b) $__ b) $___ b) $___ b) $___
Franklin Income Securities Fund, Class 1 a) $21 a) $65 a) $112 a) $242
b) $__ b) $___ b) $___ b) $___
Franklin Large Cap Growth Securities Fund, Class 1 a) $24 a) $74 a) $126 a) $270
b) $__ b) $___ b) $___ b) $___
Franklin Money Market Fund, Class 1 a) $22 a) $66 a) $114 a) $245
b) $__ b) $___ b) $___ b) $___
Franklin Natural Resources Securities Fund,
Class 1 a) $23 a) $70 a) $120 a) $258
b) $__ b) $___ b) $___ b) $___
Franklin Real Estate Fund, Class 1 a) $22 a) $68 a) $116 a) $250
b) $__ b) $___ b) $___ b) $___
Franklin Rising Dividends Securities Fund, Class 1 a) $22 a) $66 a) $114 a) $245
b) $__ b) $___ b) $___ b) $___
Franklin S&P 500 Index Fund, Class 1* a) $26 a) $80 a) $137 a) $291
b) $__ b) $___ b) $___ b) $___
Franklin Small Cap Fund, Class 1 a) $24 a) $75 a) $129 a) $275
b) $__ b) $___ b) $___ b) $___
Franklin Technology Securities Fund, Class 1 a) $26 a) $78 a) $134 a) $286
b) $__ b) $___ b) $___ b) $___
Franklin U.S. Government Fund, Class 1 a) $21 a) $66 a) $113 a) $243
b) $__ b) $___ b) $___ b) $___
Franklin Value Securities Fund, Class 1 a) $24 a) $75 a) $128 a) $274
b) $__ b) $___ b) $___ b) $___
Franklin Zero Coupon Fund - 2000, Class 1 a) $23 a) $70 a) $120 a) $257
b) $__ b) $___ b) $___ b) $___
Franklin Zero Coupon Fund - 2005, Class 1 a) $23 a) $70 a) $120 a) $257
b) $__ b) $___ b) $___ b) $___
Franklin Zero Coupon Fund - 2010, Class 1 a) $23 a) $70 a) $120 a) $257
b) $__ b) $___ b) $___ b) $___
Mutual Discovery Securities Fund, Class 1 a) $26 a) $81 a) $138 a) $294
b) $__ b) $___ b) $___ b) $___
Mutual Shares Securities Fund, Class 1 a) $24 a) $74 a) $127 a) $272
b) $__ b) $___ b) $___ b) $___
Templeton Asset Strategy Fund, Class 1 a) $24 a) $74 a) $127 a) $271
b) $__ b) $___ b) $___ b) $___
Templeton Developing Markets Securities Fund,
Class 1 a) $32 a) $97 a) $165 a) $346
b) $__ b) $___ b) $___ b) $___
Templeton Global Income Securities Fund, Class 1 a) $22 a) $66 a) $114 a) $245
b) $__ b) $___ b) $___ b) $___
Templeton Growth Securities Fund, Class 1 a) $25 a) $77 a) $132 a) $281
b) $__ b) $___ b) $___ b) $___
Templeton International Securities Fund, Class 1 a) $25 a) $77 a) $132 a) $281
b) $__ b) $___ b) $___ b) $___
Templeton International Smaller Companies Fund,
Class 1 a) $27 a) $84 a) $143 a) $303
b) $__ b) $___ b) $___ b) $___
Templeton Pacific Growth Securities Fund, Class 1 a) $27 a) $83 a) $142 a) $300
b) $__ b) $___ b) $___ b) $___
USAllianz VIP Diversified Assets Fund* a) $24 a) $73 a) $125 a) $267
b) $__ b) $___ b) $___ b) $___
USAllianz VIP Fixed Income Fund* a) $21 a) $65 a) $112 a) $242
b) $__ b) $___ b) $___ b) $___
USAllianz VIP Growth Fund* a) $23 a) $70 a) $120 a) $257
b) $__ b) $___ b) $___ b) $___
<FN>
*Estimated
</FN>
</TABLE>
SEE THE APPENDIX FOR ACCUMULATION UNIT VALUES - CONDENSED FINANCIAL INFORMATION.
<PAGE>
1. The Valuemark IV
Variable Annuity Contract
-------------------------------------------------------------------------------
This prospectus describes a variable deferred annuity contract with a Fixed
Account offered by Allianz Life.
An annuity is a Contract between you, the owner, and an insurance company (in
this case Allianz Life), where the insurance company promises to pay you (or
someone else you choose) an income, in the form of Annuity Payments. The Annuity
Payments must begin on a designated date that is at least two years in the
future. Until you decide to begin receiving Annuity Payments, your annuity is in
the Accumulation Phase. Once you begin receiving Annuity Payments, your Contract
switches to the Payout Phase.
The Contract benefits from Tax Deferral. Tax Deferral means that you are not
taxed on any earnings or appreciation on the assets in your Contract until you
take money out of your Contract.
Your investment choices include Variable Options and the Fixed Account of
Allianz Life. The Contract is called a variable annuity because you can choose
among the Variable Options and, depending upon market conditions, you can make
or lose money in the Contract based on the investment performance of the
Portfolios. The Portfolios are designed to offer a better return than the Fixed
Account. However, this is not guaranteed. The amount of money you are able to
accumulate in your Contract during the Accumulation Phase depends in large part
upon the investment performance of the Portfolio(s) you select. The amount of
the Annuity Payments you receive during the Payout Phase of the Contract also
depends in large part upon the investment performance of the Portfolios you
select for the Payout Phase.
The Contract also contains a Fixed Account. The Fixed Account offers an interest
rate that is guaranteed by Allianz Life for all deposits made within the twelve
month period. Your initial interest rate is set on the date when your money is
invested in the Fixed Account and remains effective for one year. Initial
interest rates are declared monthly. Allianz Life guarantees that the interest
credited to the Fixed Account will not be less than 3% per year. If you select
the Fixed Account, your money will be placed with the other general account
assets of Allianz Life. Allianz Life may change the terms of the Fixed Account
in the future - please contact Allianz Life for the most current terms.
If you select the Fixed Account, the amount of money you are able to accumulate
in your Contract during the Accumulation Phase depends upon the total interest
credited to your Contract.
We will not make any changes to your Contract without your permission except as
may be required by law.
CONTRACT OWNER
You, as the Contract Owner, have all the rights under the Contract. The Contract
Owner is as designated at the time the Contract is issued, unless changed. You
may change Contract Owners at any time. This may be a taxable event. You should
consult with your tax adviser before doing this.
JOINT OWNER
The Contract can be owned by Joint Owners. Any Joint Owner must be the spouse of
the other Contract Owner (except in Pennsylvania, Oregon and New Jersey). Upon
the death of either Joint Owner, the surviving Joint Owner will be the
designated Beneficiary. Any other Beneficiary designation at the time the
Contract was issued or as may have been later changed will be treated as a
contingent Beneficiary unless otherwise indicated.
ANNUITANT
The Annuitant is the natural person on whose life we base Annuity Payments. You
name the Annuitant. You may change the Annuitant at any time before the Income
Date unless the Contract is owned by a non-individual (for example, a
corporation).
BENEFICIARY
The Beneficiary is the person(s) or entity you name to receive any death
benefit. The Beneficiary is named at the time the Contract is issued unless
changed at a later date. Unless an irrevocable Beneficiary has been named, you
can change the Beneficiary or contingent Beneficiary.
ASSIGNMENT
You can transfer ownership (assign) of the Contract at any time during your
lifetime. Allianz Life will not be bound by the assignment until it receives
written notice of the assignment. Allianz Life will not be liable for any
payment or other action it takes in accordance with the Contract before it
receives notice of the assignment. Any assignment made after the death benefit
has become payable can only be done with our consent. AN ASSIGNMENT MAY BE A
TAXABLE EVENT.
If the Contract is issued pursuant to a Qualified plan, you may be unable to
assign the Contract.
2. Annuity Payments (The Payout Phase)
-------------------------------------------------------------------------------
Income Date
You can receive regular monthly income payments under your Contract. You can
choose the month and year in which those payments begin. We call that date the
Income Date. Your Income Date must be the first day of a calendar month and must
be at least 2 years after you buy the Contract. If you select one of the
Guaranteed Minimum Income Benefits (GMIB), your Income Date must be within 30
days following a Contract anniversary beginning with the 7th Contract
anniversary (and certain other conditions must be met).
We ask you to choose your Income Date when you purchase the Contract. You can
change it at any time before the Income Date with 30 days notice to us. Annuity
Payments must begin by the Annuitant's 85th birthday or 10 years (5 years in
Pennsylvania) from the date the Contract was issued, whichever is later. This
limitation may not apply when the Contract is issued to a charitable remainder
trust.
Annuity Payments
You may elect to receive your Annuity Payments as a variable payout, a fixed
payout, or a combination of both. Under a fixed payout, all of the Annuity
Payments will be the same dollar amount (equal installments). If you choose a
variable payout, you can select from the available Variable Options. If you do
not tell us otherwise, your Annuity Payments will be based on the investment
allocations that were in place on the Income Date.
If you choose to have any portion of your Annuity Payments based on the
investment performance of the Variable Option(s), the dollar amount of your
payments will depend upon three things:
1) the value of your Contract in the Variable Option(s) on the Income Date;
2) the 5% assumed investment rate used in the annuity table for the Contract;
and
3) the performance of the Variable Option(s) you selected.
If the actual performance exceeds the 5% assumed investment rate, your Annuity
Payments will increase. Similarly, if the actual rate is less than 5%, your
Annuity Payments will decrease.
You (or someone you designate) will receive the Annuity Payments. You will
receive tax reporting on those payments.
GUARANTEED MINIMUM INCOME BENEFITS
If you purchase the Contract on or after _________, 2000, at the time you
purchase the Contract, you can select a Guaranteed Minimum Income Benefit
(GMIB). Once you select a GMIB, it cannot be changed. You must be younger than
74 years old to elect a GMIB. There are two GMIB options (Option 1 and 2). The
GMIB will match the death benefit option you select (see Section 9 - Death
Benefits). The mortality and expense risk charge is higher for Contracts with a
GMIB.
The GMIB may not be available in your state. Check with your registered
representative regarding availability.
The guaranteed minimum income benefits are described below and may be used in
determining the amount of each Annuity Payment you receive during the Payout
Phase. The GMIB can be used with any fixed Annuity Option provided for in the
Contract and provides for guaranteed minimum Annuity Payments during the Payout
Phase. The GMIB will apply only under the following circumstances:
Your Income date must be within 30 days following a Contract anniversary
beginning with the 7th Contract anniversary;
Annuity Payments can only be made under a fixed annuity payout (regardless
of the Annuity Option you select); and
If you choose an Annuity Option involving a period certain, the period
certain must be for at least 10 years.
If Joint Owners are named, the age of the oldest Contract Owner will be used to
determine the GMIB value. If a non-natural person owns the Contract, the
Contract Owner means the Annuitant.
GMIB OPTION 1
The guaranteed fixed annuity rates in the Contract will be applied to the GMIB
Value.
The GMIB Value is:
A. Prior to the first Contract anniversary: the GMIB is equal to the Purchase
Payments you have made, less any withdrawals and contingent deferred sales
charges paid on such withdrawals.
B. From the first Contract anniversary to your 81st birthday and before the
date of death, the GMIB Value is the greater of (1) or (2) below:
1. 5% Increase
Purchase Payments you have made,
less any withdrawals and any contingent deferred sales charges paid
on such withdrawals,
plus 5% on each Contract anniversary.
2. Highest 6th Year Anniversary Value
highest Contract value on any sixth year Contract anniversary,
plus any Purchase Payments made since that Contract anniversary,
less any withdrawals since that Contract anniversary and any
contingent deferred sales charges paid on the withdrawals.
Contract anniversaries occurring on or after your 81st birthday or date
of death will not be taken into consideration in determining this benefit.
C. After your 81st birthday, the GMIB Value determined as of the last Contract
anniversary prior to your 81st birthday will be increased by any Purchase
Payments you made since such Contract anniversary, less any withdrawals and
contingent deferred sales charges paid on such withdrawals since such
anniversary.
GMIB Option 2
The guaranteed fixed annuity rates in the Contract will be applied to the GMIB
Value.
The GMIB Value is equal to the greater of:
Purchase Payments you have made, less any withdrawals and any contingent
deferred sales charges paid on the withdrawals, or
The greatest anniversary value. The "anniversary value" is the value of the
Contract on a Contract anniversary, increased by Purchase Payments you have made
since that anniversary and decreased by any withdrawals and any contingent
deferred sales charges paid on the surrenders since that anniversary. Allianz
Life will not take into consideration any Contract anniversaries which occur on
or after your 81st birthday or date of death in determining this benefit.
ANNUITY OPTIONS
You can choose among income plans. We call them Annuity Options. You can choose
one of the following Annuity Options or any other Annuity Option you want and
that Allianz Life agrees to provide. After Annuity Payments begin, you cannot
change the Annuity Option.
If you do not choose an Annuity Option prior to the Income Date, we will assume
that you selected Option 2 which provides a life annuity with 5 years (10 years
of you select the GMIB) of guaranteed payments.
OPTION 1. LIFE ANNUITY. Under this option, we will make monthly Annuity Payments
so long as the Annuitant is alive. After the Annuitant dies, we stop making
Annuity Payments.
OPTION 2. LIFE ANNUITY WITH 5, 10, 15 OR 20 YEAR PAYMENTS GUARANTEED. Under this
option, we will make monthly Annuity Payments so long as the Annuitant is alive.
However, if the Annuitant dies before the end of the selected guaranteed period,
we will continue to make Annuity Payments to you or any person you choose for
the rest of the guaranteed period. If you do not want to receive Annuity
Payments after the Annuitant's death, you can ask us for a single lump sum.
OPTION 3. JOINT AND LAST SURVIVOR ANNUITY. Under this option, we will make
monthly Annuity Payments during the joint lifetime of the Annuitant and the
joint Annuitant. When the Annuitant dies, if the joint Annuitant is still alive,
we will continue to make Annuity Payments so long as the joint Annuitant
continues to live. The amount of the Annuity Payments we will make to you can be
equal to 100%, 75% or 50% of the amount that was being paid when both Annuitants
were alive. The monthly Annuity Payments will end when the last surviving
Annuitant dies.
OPTION 4. JOINT AND LAST SURVIVOR ANNUITY WITH 5, 10, 15 OR 20 YEAR PAYMENTS
GUARANTEED. Under this option, we will make monthly Annuity Payments during the
joint lifetime of the Annuitant and the joint Annuitant. When the Annuitant
dies, if the joint Annuitant is still alive, we will continue to make Annuity
Payments, so long as the surviving Annuitant continues to live, at 100% of the
amount that was being paid when both were alive. If, when the last death occurs,
we have made Annuity Payments for less than the selected guaranteed period, we
will continue to make Annuity Payments to you or any person you choose for the
rest of the guaranteed period. If you do not want to receive Annuity Payments
after the Annuitant's death, you can ask us for a single lump sum.
OPTION 5. REFUND LIFE ANNUITY. Under this option, we will make monthly Annuity
Payments during the Annuitant's lifetime. The last Annuity Payment will be made
before the Annuitant dies and if the value of the Annuity Payments made is less
than the value applied to the Annuity Option, then you will receive a refund as
set forth in the Contract.
3. PURCHASE
--------------------------------------------------------------------------------
PURCHASE PAYMENTS
A Purchase Payment is the money you invest in the Contract. Generally, the
minimum payment Allianz Life will accept is $5,000 when the Contract is bought
as a Non-Qualified Contract. If you enroll in the Automatic Investment Plan
(which is described below), your Purchase Payment can be $2,000. If you are
buying the Contract as part of an IRA (Individual Retirement Annuity), 401(k) or
other Qualified plan, the minimum amount we will accept is $2,000. The maximum
amount we will accept without our prior approval is $1 million. You can make
additional Purchase Payments of $250 (or as low as $100 if you have selected the
Automatic Investment Plan) or more to either type of Contract. Allianz Life may,
at its sole discretion, waive the minimum payment requirements. We reserve the
right to decline any Purchase Payments. At the time you buy the Contract, you
and the Annuitant cannot be older than 85 years old.
This product is not designed for professional market timing organizations, other
entities, or persons using programmed, large or frequent transfers.
AUTOMATIC INVESTMENT PLAN
The Automatic Investment Plan (AIP) is a program which allows you to make
additional Purchase Payments to your Contract on a monthly or quarterly basis by
electronic transfer of monies from your savings or checking account. You may
participate in this program by completing the appropriate form. We must receive
your form by the first of the month in order for AIP to begin that same month.
Investments will take place on the 20th of the month, or the next business day.
The minimum investment that can be made by AIP is $100. You may stop AIP at any
time you want. We need to be notified by the first of the month in order to stop
or change AIP that month. If AIP is used for a Qualified Contract, you should
consult your tax adviser for advice regarding maximum contributions.
BONUSES
If you purchase the Contract on or after _________, 2000, you may select the
Immediate Bonus, or the Loyalty Bonus or both. You must be younger than 70 years
old at the time we issue the Contract to elect a Bonus.
One or both Bonuses may not be available in your state. Check with your
registered representative regarding availability.
Immediate Bonus
You can only select the Immediate Bonus at the time you buy the Contract. If you
select the Immediate Bonus, Allianz Life will credit each Purchase Payment you
make, within the first 6 months after it issues your Contract (issue date), with
a Bonus equal to 3.5% of the Purchase Payment. The Bonus will be credited at the
time the Purchase Payment is credited to the Contract.
If you die before the first Contract anniversary from the issue date, Allianz
Life will take back the Bonus amounts before calculating the death benefit
amount. If your surviving spouse elects to continue the Contract instead of
electing to be paid under a death benefit option, Allianz Life will not take
back the Bonus. In addition, if you revoke the Contract during the free look
period, Allianz Life will take back the Bonus.
Loyalty Bonus
You can select the Loyalty Bonus at any time before the 7th Contract
anniversary. If you select the Loyalty Bonus prior to the 7th Contract
anniversary, on the 7th Contract anniversary, Allianz Life will credit a Bonus
equal to 3.25% of the Contract value. The Bonus will vest 5 years after the date
it is credited to your Contract. If you make a full surrender, partial surrender
or apply your Contract value to an Annuity Option during the 5 year period,
Allianz Life will take back the Loyalty Bonus. Partial surrenders during this 5
year period will reduce the Bonus amount by the amount of Bonus attributable to
the amount surrendered (pro- rata). In the case of a death benefit during the
Accumulation Phase, the Loyalty Bonus will be fully vested if the death occurs
more than 12 completed months after the 7th Contract anniversary. If you die
within the first 12 months from the 7th Contract anniversary, Allianz Life will
take back the Loyalty Bonus before calculating the death benefit amount. If your
surviving spouse elects to continue the Contract instead of electing to be paid
under a death benefit option, Allianz Life will not take back the Loyalty Bonus.
General Provisions Applicable to the Bonuses
All bonus amounts and any gains and losses attributable to such amounts are
treated as earnings under the Contract. All gains and losses attributable to any
Bonus are part of your Contract value and will never be taken back by Allianz
Life.
All Bonus amounts are paid from the general account assets of Allianz Life.
Contract charges are deducted from the total value of your Contract. Therefore,
your Contract incurs expenses on the total value of your Contract, which
includes any Bonus amounts. Under certain circumstances, Allianz Life may take
back the Bonus. Since charges will have been assessed against the higher amount
(Purchase Payment/Contract value plus any Bonus), it is possible that upon
surrender, particularly in a declining market, you will receive back less money
than you would have if you had not received the Loyalty Bonus or had not
purchased a Bonus Contract. We expect to profit from certain charges assessed
under the Contract (i.e., the contingent deferred sales charge and the mortality
and expense risk charge) associated with the Bonus.
Allianz Life has applied to the Securities and Exchange Commission for an
exemption from certain provisions of the Investment Company Act of 1940 so that
it can take back Bonus amounts applied to a Contract, as described above. Until
such time as it receives approval of its exemptive request, Allianz Life will
not take back any Bonus amounts.
ALLOCATION OF PURCHASE PAYMENTS
When you purchase a Contract, we will allocate your Purchase Payment and any
Bonus amounts to the Fixed Account and/or one or more of the Variable Options
you have selected. We ask that you allocate your money in either whole
percentages or round dollars. The Fixed Account may not be available in your
state (check with your registered representative). Transfers do not change the
allocation instructions for payments. You can instruct us how to allocate
additional Purchase Payments you make and any Bonus amounts. If you do not
instruct us, we will allocate them in the same way as your previous instructions
to us. You may change the allocation of future payments without fee, penalty or
other charge upon written notice or telephone instructions to the USAllianz
Service Center.
A change will be effective for payments received on or after we receive your
notice or instructions. Allianz Life reserves the right to limit the number of
Variable Options that you may invest in at one time. Currently, you may invest
in 10 investment choices at any one time (which includes any of the Variable
Options listed in Section 4 and the Allianz Life Fixed Account). We may change
this in the future. However, we will always allow you to invest in at least five
Variable Options.
Once we receive your Purchase Payment and the necessary information, we will
issue your Contract and allocate your first Purchase Payment and any applicable
Immediate Bonus within 2 business days. If you do not give us all of the
information we need, we will contact you or your registered representative to
get it. If for some reason we are unable to complete this process within 5
business days, we will either send back your money or get your permission to
keep it until we get all of the necessary information. If you make additional
Purchase Payments, we will credit these amounts to your Contract within one
business day. Our business day closes when the New York Stock Exchange closes,
which is usually at 4:00 p.m. Eastern time.
FREE LOOK
If you change your mind about owning the Contract, you can cancel it within 10
days after receiving it (or the period required in your state). When you cancel
the Contract within this time period, Allianz Life will not assess a contingent
deferred sales charge. You will receive back whatever your Contract is worth on
the day we receive your request (less the Immediate Bonus, if applicable). In
certain states, or if you have purchased the Contract as an IRA, we may be
required to give you back your Purchase Payment if you decide to cancel your
Contract within 10 days after receiving it (or whatever period is required in
your state). If that is the case, we reserve the right to allocate your initial
Purchase Payment to the Franklin Money Market Fund for 15 days after we receive
it. (In some states, the period may be longer.) At the end of that period, we
will re-allocate your money as you selected. Currently, however, we will
directly allocate your money to the Variable Options and/or the Fixed Account as
you have selected.
ACCUMULATION UNITS
The value of the portion of your Contract allocated to the Variable Options will
go up or down based upon the investment performance of the Variable Option(s)
you choose. The value of your Contract will also depend on the expenses of the
Contract. In order to keep track of the value of your Contract, we use a
measurement called an Accumulation Unit (which is like a share of a mutual
fund). During the Payout Phase of the Contract we call it an Annuity Unit.
Every business day we determine the value of an Accumulation Unit for each
Variable Option by multiplying the Accumulation Unit value for the previous
period by a factor for the current period. The factor is determined by:
1) dividing the value of a Portfolio at the end of the current period by the
value of a Portfolio for the previous period; and
2) multiplying it by one minus the daily amount of the insurance charges and any
charges for taxes.
The value of an Accumulation Unit may go up or down from day to day.
When you make a Purchase Payment, we credit your Contract with Accumulation
Units for any portion of your Purchase Payment (and any applicable Bonus)
allocated to a Variable Option. The number of Accumulation Units we credit your
Contract with is determined by dividing the amount of the Purchase Payment (and
any applicable Bonus) allocated to a Variable Option by the value of the
corresponding Accumulation Unit.
We calculate the value of each Accumulation Unit after the New York Stock
Exchange closes each day and then credit your Contract.
EXAMPLE:
On Wednesday we receive an additional Purchase Payment of $3,000 from you (plus
we add $105 Bonus amount, assuming you made the additional Purchase Payment
within 6 months after you bought the Contract and select the Immediate Bonus).
You have told us you want this to go to the Franklin Growth and Income
Securities Fund. When the New York Stock Exchange closes on that Wednesday, we
determine that the value of an Accumulation Unit based on an investment in the
Franklin Growth and Income Securities Fund is $12.50. We then divide $3,105 by
$12.50 and credit your Contract on Wednesday night with 248.40 Accumulation
Units.
4.INVESTMENT OPTIONS
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The Contract offers Variable Options, which invest in Portfolios of AIM Variable
Insurance Funds, The Alger American Fund, Franklin Templeton Variable Insurance
Products Trust, and USAllianz Variable Insurance Products Trust. The Contract
also offers a Fixed Account of Allianz Life. Additional Portfolios may be
available in the future.
You should read the fund prospectuses (which are attached to this prospectus)
carefully before investing.
AIM Variable Insurance Funds, The Alger American Fund, Franklin Templeton
Variable Insurance Products Trust and USAllianz Variable Insurance Products
Trust are the funds underlying your Contract. Each Portfolio has its own
investment objective.
Franklin Templeton Variable Insurance Products Trust (formerly, Franklin
Valuemark Funds) issues two classes of shares which are described in the
attached prospectus for Franklin Templeton Variable Insurance Products Trust.
Only Class 1 shares are available in connection with your Contract. Effective
May 1, 2000 the funds of Templeton Variable Products Series Fund were merged
into similar funds of Franklin Templeton Variable Insurance Products Trust.
Investment advisers for each Portfolio are listed in the table below and are as
follows: A I M Advisors, Inc., Allianz of America, Inc., Fred Alger Management,
Inc., Franklin Advisers, Inc., Franklin Advisory Services, LLC, Franklin Mutual
Advisers, LLC, Templeton Asset Management Ltd., Templeton Global Advisors
Limited, and Templeton Investment Counsel, Inc. Certain advisers have retained
one or more subadvisers to help them manage the Portfolios.
The investment objectives and policies of certain Portfolios are similar to the
investment objectives and policies of other mutual funds that certain of the
investment advisers manage. Although the objectives and policies may be similar,
the investment results of the Portfolios may be higher or lower than the results
of such other mutual funds. The investment advisers cannot guarantee, and make
no representation, that the investment results of similar funds will be
comparable even though the Portfolios have the same investment advisers. A
Portfolio's performance may be affected by risks specific to certain types of
investments, such as foreign securities, derivative investments, non-investment
grade debt securities, initial public offerings (IPOs) or companies with
relatively small market capitalizations. IPOs and other investment techniques
may have a magnified performance impact on a Portfolio with a small asset base.
A Portfolio may not experience similar performance as its assets grow.
<TABLE>
<CAPTION>
The following is a list of the Portfolios available under the Contract and the
investment adviser for each Portfolio:
INVESTMENT
AVAILABLE PORTFOLIOS ADVISERS
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<S> <C>
AIM VARIABLE INSURANCE FUNDS:
AIM V.I. Growth Fund A I M Advisors, Inc.
THE ALGER AMERICAN FUND:
Alger American Growth Portfolio Fred Alger Management, Inc.
Alger American Leveraged AllCap Portfolio Fred Alger Management, Inc.
(seeks long term capital appreciation)
FRANKLIN TEMPLETON VARIABLE
INSURANCE PRODUCTS TRUST:
Franklin Aggressive Growth Securities Fund Franklin Advisers, Inc.
Franklin Global Communications Securities Fund* Franklin Advisers, Inc.
Franklin Global Health Care Securities Fund Franklin Advisers, Inc.
Franklin Growth and Income Securities Fund* Franklin Advisers, Inc.
Franklin High Income Fund Franklin Advisers, Inc.
Franklin Income Securities Fund Franklin Advisers, Inc.
Franklin Large Cap Growth Securities Fund* Franklin Advisers, Inc.
Franklin Money Market Fund Franklin Advisers, Inc.
Franklin Natural Resources Securities Fund Franklin Advisers, Inc.
Franklin Real Estate Fund* Franklin Advisers, Inc.
Franklin Rising Dividends Securities Fund* Franklin Advisory Services, LLC
Franklin S&P 500 Index Fund Franklin Advisers, Inc.
Franklin Small Cap Fund Franklin Advisers, Inc.
Franklin Technology Securities Fund Franklin Advisers, Inc.
Franklin U.S. Government Fund* Franklin Advisers, Inc.
Franklin Value Securities Fund Franklin Advisory Services, LLC
Franklin Zero Coupon Funds - 2000, 2005 and 2010 Franklin Advisers, Inc.
Mutual Discovery Securities Fund(capital appreciation) Franklin Mutual Advisers, LLC
Mutual Shares Securities Fund Franklin Mutual Advisers, LLC
(capital appreciation with income as a secondary goal)
Templeton Asset Strategy Fund* Templeton Investment Counsel, Inc.
Templeton Developing Markets Securities Fund* Templeton Asset Management Ltd.
Templeton Global Income Securities Fund Franklin Advisers, Inc.
Templeton Growth Securities Fund* Templeton Global Advisors Limited
Templeton International Securities Fund* Templeton Investment Counsel, Inc.
Templeton International Smaller Companies Fund Templeton Investment Counsel, Inc.
Templeton Pacific Growth Securities Fund* Franklin Advisers, Inc.
USALLIANZ VARIABLE INSURANCE
PRODUCTS TRUST:
USAllianz VIP Diversified Assets Fund Allianz of America, Inc.
USAllianz VIP Fixed Income Fund Allianz of America, Inc.
USAllianz VIP Growth Fund Allianz of America, Inc.
</TABLE>
THE FRANKLIN ZERO COUPON FUND-2000 WILL MATURE DECEMBER 15, 2000. If you have
not made a selection prior to the maturity date of the Zero Coupon Fund-2000,
the Contract Value held in the Zero Coupon Fund 2000 underlying your Contract
will be automatically transferred to the Franklin Money Market Fund. We will
notify you of a maturing Zero Coupon Fund in writing at least 30 days prior to
the maturity. Included with the notification will be investment options
available at that time as well as the automatic Money Market option.
Shares of the Portfolios may be offered in connection with certain variable
annuity contracts and variable life insurance policies of various insurance
companies which may or may not be affiliated with Allianz Life. Certain
Portfolios may also be sold directly to qualified plans. The investment advisers
believe that offering their shares in this manner will not be disadvantageous to
you.
Allianz Life may enter into certain arrangements under which it is reimbursed by
the funds' advisers, distributors and/or affiliates for the administrative
services which it provides to the Portfolios.
TRANSFERS
You can transfer money among the Variable Options and/or the Fixed Account.
Allianz Life currently allows you to make as many transfers as you want to each
year. Allianz Life may change this practice in the future. However, this product
is not designed for professional market timing organizations or other persons
using programmed, large, or frequent transfers. Such activity may be disruptive
to a Portfolio. We reserve the right to reject any specific Purchase Payment
allocation or transfer request from any person, if in the Portfolio manager's
judgment, a Portfolio would be unable to invest effectively in accordance with
its investment objectives and policies, or would otherwise potentially be
adversely affected.
Your Contract provides that you can make 3 transfers every year without charge.
However, currently Allianz Life permits you to make 12 transfers every year
without charge. We measure a year from the anniversary of the day we issued your
Contract. You can make a transfer to or from the Fixed Account and to or from
any Variable Option. If you make more than 12 transfers in a year, there is a
transfer fee deducted. The fee is $25 per transfer or, if less, 2% of the amount
transferred. The following applies to any transfer:
1) The minimum amount which you can transfer is $1,000 ($500 in New Jersey) or
your entire value in the Variable Option or Fixed Account, if less. This
requirement is waived if the transfer is in connection with the Dollar Cost
Averaging Program or Flexible Rebalancing (which are described below).
2) We may not allow you to make transfers during the free look period.
3) Your request for a transfer must clearly state which Variable Option(s) or
the Fixed Account is involved in the transfer.
4) Your request for a transfer must clearly state how much the transfer is for.
5) You cannot make any transfers within 7 calendar days prior to the date your
first Annuity Payment is due.
6) During the Payout Phase, you may not make a transfer from a fixed Annuity
Option to a variable Annuity Option.
7) During the Payout Phase, you can make at least one transfer from a variable
Annuity Option to a fixed Annuity Option.
Allianz Life has reserved the right to modify the transfer provisions subject to
the guarantees described above and subject to applicable state law.
You can make transfers by telephone. We may allow you to authorize someone else
to make transfers by telephone on your behalf. If you own the Contract with a
Joint Owner, unless you instruct Allianz Life otherwise, we will accept
instructions from either one of you. Allianz Life will use reasonable procedures
to confirm that instructions given to us by telephone are genuine. If we do not
use such procedures, we may be liable for any losses due to unauthorized or
fraudulent instructions. Allianz Life tape records all telephone instructions.
DOLLAR COST AVERAGING PROGRAM
The Dollar Cost Averaging Program allows you to systematically transfer a set
amount of money each month or quarter from any one Variable Option or the Fixed
Account to up to eight of the other Variable Options.
The Variable Option(s) you transfer from may not be the Variable Option(s) you
transfer to in this program. By allocating amounts on a regularly scheduled
basis, as opposed to allocating the total amount at one particular time, you may
be less susceptible to the impact of market fluctuations. You may only
participate in this program during the Accumulation Phase.
If you choose to participate in this program, you must participate for at least
six months (or two quarters) and must transfer at least $500 each time (or
$1,500 each quarter). Your allocations can be in whole percentages or dollar
amounts. You may elect this program by properly completing the Dollar Cost
Averaging forms provided by Allianz Life.
All Dollar Cost Averaging transfers will be made on the 10th day of the month
unless that day is not a business day. If it is not, then the transfer will be
made the next business day.
Your participation in the program will end when any of the following occurs:
1) the number of desired transfers have been made;
2) you do not have enough money in the Variable Option(s) or the Fixed Account
to make the transfer (if less money is available, that amount will be dollar
cost averaged and the program will end);
3) you request to terminate the program (your request must be received by us by
the first of the month to terminate that month); or
4) the Contract is terminated.
If you participate in the Dollar Cost Averaging Program, the transfers made
under the program are not currently taken into account in determining any
transfer fee. You may not participate in the Dollar Cost Averaging Program and
Flexible Rebalancing at the same time.
FLEXIBLE REBALANCING
Once your money has been invested, the performance of the Variable Options may
cause your chosen allocation to shift. Flexible Rebalancing is designed to help
you maintain your specified allocation mix among the different Variable Options.
You can direct us to readjust your Contract value on a quarterly, semi-annual or
annual basis to return to your original Variable Option allocations. Flexible
Rebalancing transfers will be made on the 20th day of the month unless that day
is not a business day. If it is not, then the transfer will be made on the
previous day. If you participate in Flexible Rebalancing, the transfers made
under the program are not currently taken into account in determining any
transfer fee. The Fixed Account is not permitted to be part of Flexible
Rebalancing.
VOTING PRIVILEGES
Allianz Life is the legal owner of the Portfolio shares. However, when a
Portfolio solicits proxies in conjunction with a shareholder vote which affects
your investment, Allianz Life will obtain from you and other affected Contract
Owners instructions as to how to vote those shares. When we receive those
instructions, we will vote all of the shares we own in proportion to those
instructions. This will also include any shares that Allianz Life owns on its
own behalf. Should Allianz Life determine that it is no longer required to
comply with the above, we will vote the shares in our own right.
SUBSTITUTION
Allianz Life may substitute one of the Variable Options you have selected with
another Variable Option. We would not do this without the prior approval of the
Securities and Exchange Commission. We will give you notice of our intention to
do this. We may also limit further investment in a Variable Option if we deem
the investment inappropriate.
5. EXPENSES
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There are charges and other expenses associated with the Contract that will
reduce your investment return. These charges and expenses are:
INSURANCE CHARGES
Each day, Allianz Life makes a deduction for its insurance charges. Allianz Life
does this as part of its calculation of the value of the Accumulation Units and
the value of the Annuity Units. The insurance charge has two parts:
1) the mortality and expense risk charge, and
2) the administrative charge.
MORTALITY AND EXPENSE RISK CHARGE. The amount of the mortality and expense risk
charge depends on whether you select the Immediate Bonus and/or the Loyalty
Bonus and/or the GMIB (or none of these benefits). During the Accumulation
Phase, this charge is equal, on an annual basis, to the amounts set forth in the
table below (as a percentage of the average daily value of the Contract invested
in a Variable Option):
<TABLE>
<CAPTION>
Contract Contract After 12
Bonus and GMIB Options Years 1-7 Years 8-12 Contract Years
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<S> <C> <C> <C>
Immediate Bonus (only) 1.84% 1.34% 1.34%
Loyalty Bonus (only) 1.34% 1.84% 1.34%
Immediate & Loyalty Bonus (only) 1.84% 1.84% 1.34%
GMIB (only) 1.64% 1.64% 1.64%
GMIB & Loyalty Bonus (only) 1.64% 2.14% 1.64%
GMIB & Immediate Bonus (only) 2.14% 1.64% 1.64%
GMIB, Immediate Bonus &
Loyalty Bonus 2.14% 2.14% 1.64%
None of these options is
selected 1.34% 1.34% 1.34%
</TABLE>
During the Payout Phase, the charge is equal, on an annual basis, to 1.25% of
the average daily value of the Contract invested in a Variable Option,
regardless of the option(s) selected.
This charge compensates us for all the insurance benefits provided by your
Contract (for example, our contractual obligation to make Annuity Payments, the
death benefits, certain expenses related to the Contract, and for assuming the
risk (expense risk) that the current charges will be insufficient in the future
to cover the cost of administering the Contract). The amount of the mortality
and expense risk charge is less during the Payout Phase because Allianz Life
does not pay a death benefit separate from benefits under the Annuity Option if
you die during the Payout Phase.
ADMINISTRATIVE CHARGE. This charge is equal, on an annual basis, to .15% of the
average daily value of the Contract invested in a Variable Option. This charge,
together with the contract maintenance charge (which is explained below), is for
all the expenses associated with the administration of the Contract. Some of
these expenses include: preparation of the Contract, confirmations, annual
statements, maintenance of Contract records, personnel costs, legal and
accounting fees, filing fees, and computer and systems costs.
CONTRACT MAINTENANCE CHARGE
On each Contract anniversary, Allianz Life deducts $30 from your Contract as a
contract maintenance charge. The fee is assessed on the last day of each
Contract year. (In South Carolina, we will waive the contract maintenance
charge that is to be deducted after the 20th Contract anniversary.) This
charge is for administrative expenses (see above). This charge cannot be
increased.
However, during the Accumulation Phase, if the value of your Contract is at
least $50,000 when the deduction for the charge is to be made, Allianz Life will
not deduct this charge. If you own more than one Valuemark IV Contract, Allianz
Life will determine the total value of all your Valuemark IV Contracts. If the
total value of all Valuemark IV Contracts registered under the same social
security number is at least $50,000, Allianz Life will not assess the contract
maintenance charge (except in New Jersey). Currently, the charge is also waived
during the Payout Phase if the value of your Contract at the Income Date is at
least $50,000. If the Contract is owned by a non-natural person (e.g., a
corporation), Allianz Life will look to the Annuitant to determine if it will
assess the charge.
If you make a complete withdrawal from your Contract, the contract maintenance
charge will also be deducted. During the Payout Phase, if the contract
maintenance charge is deducted, the charge will be collected monthly out of each
Annuity Payment.
CONTINGENT DEFERRED SALES CHARGE
Withdrawals may be subject to a contingent deferred sales charge. During the
Accumulation Phase, you can make withdrawals from your Contract. Allianz Life
keeps track of each Purchase Payment you make. The amount of the contingent
deferred sales charge depends upon the length of time since you made your
Purchase Payment and whether you select the Immediate Bonus. The charge is:
<TABLE>
<CAPTION>
CONTRACTS WITHOUT IMMEDIATE BONUS
YEARS SINCE CONTINGENT DEFERRED CONTRACTS WITH IMMEDIATE BONUS
PURCHASE SALES CHARGE CONTINGENT DEFERRED SALES CHARGE
PAYMENTS (AS A % OF PURCHASE PAYMENTS) (AS A % OF PURCHASE PAYMENTS)
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<S> <C> <C> <C>
0-1 6% 9.5%
1-2 6% 9.5%
2-3 6% 9.0%
3-4 5% 7.5%
4-5 4% 6.0%
5-6 3% 4.5%
6-7 2% 3.0%
7+ 0% 0%
</TABLE>
However, after Allianz Life has had a Purchase Payment for 7 full years, there
is no charge when you withdraw that Purchase Payment. For purposes of the
contingent deferred sales charge, Allianz Life treats withdrawals as coming from
the oldest Purchase Payments first. Allianz Life does not assess the contingent
deferred sales charge on any payments paid out as Annuity Payments or as death
benefits.
In the state of Washington, the contingent deferred sales charge will be waived
beginning with the later of the first Contract anniversary after you attain age
70 or the 10th Contract anniversary.
NOTE: FOR TAX PURPOSES, WITHDRAWALS ARE CONSIDERED TO HAVE COME FROM THE LAST
MONEY YOU PUT INTO THE CONTRACT. THUS, FOR TAX PURPOSES, EARNINGS AND ANY BONUS
ARE CONSIDERED TO COME OUT FIRST.
Free Withdrawal Amount (referred to in sales literature as "15% Withdrawal
Privilege") - Each year after the first Contract year, you can make multiple
withdrawals up to 15% of the value of your Contract and no contingent deferred
sales charge will be deducted from the 15% you take out. (This amount may be
increased when the Contract is issued to a charitable remainder trust.) If you
make a withdrawal of more than the free amount, it will be subject to the
contingent deferred sales charge. If you do not withdraw the full 15% in any one
Contract year, you may not carry over the remaining percentage amount to another
year. The free withdrawal amount is not applicable to a full surrender. The free
withdrawal amount only applies in the event of a partial withdrawal.
You may also elect to participate in the Systematic Withdrawal Program or the
Minimum Distribution Program. These programs allow you to make withdrawals
without the deduction of the contingent deferred sales charge under certain
circumstances. See Section 7 -- "Access to Your Money" for a description of the
Systematic Withdrawal Program and the Minimum Distribution Program.
WAIVER OF CONTINGENT DEFERRED SALES CHARGE BENEFITS
Under certain circumstances, after the first year, Allianz Life will permit you
to take your money out of the Contract without deducting a contingent deferred
sales charge:
1) if you become confined to a nursing home for at least 90 days;
2) if you become terminally ill, which is defined as life expectancy of 12
months or less (a full withdrawal of the Contract will be required); or
3) if you become totally disabled for at least 90 consecutive days.
The waiver will not apply if any of the above conditions existed on the date
your Contract was issued.
Also, after the first year, if you become unemployed for at least 90 consecutive
days, you can take up to 50% of your Contract value out of the Contract without
incurring a contingent deferred sales charge. This benefit is available only
once during the life of the Contract. You may not use both this benefit and the
15% free withdrawal amount in the same Contract year.
These benefits vary from state to state or may not be available in your state.
(Check with your registered representative.)
REDUCTION OR ELIMINATION OF THE CONTINGENT DEFERRED SALES CHARGE
Allianz Life will reduce or eliminate the amount of the contingent deferred
sales charge when the Contract is sold under circumstances which reduce its
sales expenses. Some examples are: if there is a large group of individuals that
will be purchasing the Contract or a prospective purchaser already had a
relationship with Allianz Life. Allianz Life may not deduct a contingent
deferred sales charge under a Contract issued to an officer, director or
employee of Allianz Life or any of its affiliates. Also, Allianz Life may reduce
or not deduct a contingent deferred sales charge when a Contract is sold by an
agent of Allianz Life to any members of his or her immediate family and the
commission is waived. We require our prior approval for any reduction or
elimination of the contingent deferred sales charge.
TRANSFER FEE
You can make 12 free transfers every year. We measure a year from the day we
issue your Contract. If you make more than 12 transfers a year, we will deduct a
transfer fee of $25, or 2% of the amount that is transferred, whichever is less,
for each additional transfer. If the transfer is part of the Dollar Cost
Averaging Program or Flexible Rebalancing, it will not currently count in
determining the transfer fee.
PREMIUM TAXES
Some states and other governmental entities (e.g., municipalities) charge
premium taxes or similar taxes. Allianz Life is responsible for the payment of
these taxes. We will make a deduction from the value of the Contract for them.
Some of these taxes are due when the Contract is issued, others are due when
Annuity Payments begin. It is Allianz Life's current practice to not charge you
for these taxes until you die, Annuity Payments begin or you make a complete
withdrawal. Allianz Life may discontinue this practice in the future and assess
the charge when the tax is due. Premium taxes generally range from 0% to 3.5% of
the Purchase Payment, depending on the state.
INCOME TAXES
Allianz Life reserves the right to deduct from the Contract for any income taxes
which it may incur because of the Contract. Currently, Allianz Life is not
making any such deductions.
PORTFOLIO EXPENSES
There are deductions from the assets of the various Portfolios for operating
expenses (including management fees), which are described in the Fee Table in
this prospectus and the accompanying fund prospectuses.
6. TAXES
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NOTE: ALLIANZ LIFE HAS PREPARED THE FOLLOWING INFORMATION ON TAXES AS A GENERAL
DISCUSSION OF THE SUBJECT. IT IS NOT INTENDED AS TAX ADVICE. YOU SHOULD CONSULT
YOUR OWN TAX ADVISER ABOUT YOUR OWN CIRCUMSTANCES. ALLIANZ LIFE HAS INCLUDED
ADDITIONAL INFORMATION REGARDING TAXES IN THE STATEMENT OF ADDITIONAL
INFORMATION.
ANNUITY CONTRACTS IN GENERAL
Annuity contracts are a means of setting aside money for future needs - usually
retirement. Congress recognized how important saving for retirement was and
provided special rules in the Internal Revenue Code (Code) for annuities.
Basically, these rules provide that you will not be taxed on any earnings on the
money held in your annuity Contract until you take the money out. This is
referred to as Tax Deferral. There are different rules regarding how you will be
taxed depending upon how you take the money out and the type of Contract -
Qualified or Non-Qualified (see following sections).
When a Non-Qualified Contract is owned by a non-natural person (e.g., a
corporation or certain other entities other than a trust holding the Contract as
an agent for a natural person), the Contract will generally not be treated as an
annuity for tax purposes. This means that the Contract may not receive the
benefits of Tax Deferral. Income may be taxed as ordinary income every year.
QUALIFIED AND NON-QUALIFIED CONTRACTS
If you purchase the Contract under a Qualified plan, your Contract is referred
to as a Qualified Contract. Examples of Qualified plans are: Individual
Retirement Annuities (IRAs), Tax-Sheltered Annuities (sometimes referred to as
403(b) contracts), and pension and profit-sharing plans, which include 401(k)
plans and H.R. 10 plans. If you do not purchase the Contract under a Qualified
plan, your Contract is referred to as a Non-Qualified Contract.
A Qualified Contract will not provide any necessary or additional Tax Deferral
if it is used to fund a Qualified plan that is Tax Deferred. However, the
Contract has features and benefits other than Tax Deferral that may make it an
appropriate investment for a Qualified plan. You should consult your tax adviser
regarding these features and benefits prior to purchasing a Qualified Contract.
MULTIPLE CONTRACTS
The Code provides that multiple Non-Qualified annuity contracts which are issued
within a calendar year period to the same Contract Owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences, including more rapid taxation of the distributed amounts from such
combination of contracts. For purposes of this rule, contracts received in a
Section 1035 exchange will be considered issued in the year of the exchange. You
should consult a tax adviser prior to purchasing more than one Non-Qualified
annuity contract in any calendar year period.
WITHDRAWALS -- NON-QUALIFIED CONTRACTS
You, as the Contract Owner, will not be taxed on increases in the value of your
Contract until a distribution occurs either as a withdrawal or as Annuity
Payments. When you make a withdrawal from your non-qualified Contract, the Code
treats such a withdrawal as first coming from earnings and then from your
Purchase Payments. You will be taxed on the amount of the withdrawal that is
earnings. In most cases, such withdrawn earnings are included in income. For
Annuity Payments, different rules apply. A portion of each Annuity Payment you
receive will be treated as a partial return of your Purchase Payments and will
not be taxed. The remaining portion of the Annuity Payment will be treated as
ordinary income. How the Annuity Payment is divided between taxable and non-
taxable portions depends upon the period over which the Annuity Payments are
expected to be made. Annuity Payments received after you have received all of
your Purchase Payments are fully includible in income.
The Code also provides that any amount received under an annuity contract which
is included in income may be subject to a tax penalty. The amount of the penalty
is equal to 10% of the amount that is includible in income. Some withdrawals
will be exempt from the penalty. They include any amounts:
1) paid on or after the taxpayer reaches age 59 1/2;
2) paid after you die;
3) paid if the taxpayer becomes totally disabled (as that term is defined in the
Code);
4) paid in a series of substantially equal payments made annually (or more
frequently) for life or a period not exceeding life expectancy;
5) paid under an immediate annuity; or
6) which come from purchase payments made prior to August 14, 1982.
WITHDRAWALS --QUALIFIED CONTRACTS
If you make a withdrawal from your Qualified Contract, a portion of the
withdrawal is treated as taxable income. This portion depends on the ratio of
pre-tax Purchase Payments to the after-tax Purchase Payments in your Contract.
If all of your Purchase Payments were made with pre-tax money then the full
amount of any withdrawal is includible in taxable income. Special rules may
apply to withdrawals from certain types of Qualified Contracts.
The Code also provides that any amount received under a Qualified Contract,
which is included in income, may be subject to a penalty. The amount of the
penalty is equal to 10% of the amount that is includible in income. Some
withdrawals will be exempt from the penalty. They include any amounts:
1) paid on or after you reach age 59 1/2;
2) paid after you die;
3) paid if you become totally disabled (as that term is defined in the Code);
4) paid to you after leaving your employment in a series of substantially equal
periodic payments made annually (or more frequently) under a lifetime annuity;
5) paid to you after you have attained age 55 and you have left your employment;
6) paid for certain allowable medical expenses (as defined in the Code);
7) paid pursuant to a qualified domestic relations order;
8) paid on account of an IRS levy upon the Qualified Contract;
9) paid from an IRA for medical insurance (as defined in the Code);
10) paid from an IRA for qualified higher education expenses; or
11) paid from an IRA for up to $10,000 for qualified first-time homebuyer
expenses (as defined in the Code).
The exceptions in 5) and 7) above do not apply to IRAs. The exception in 4)
above applies to IRAs but without the requirement of leaving employment.
We have provided a more complete discussion in the Statement of Additional
Information.
WITHDRAWALS -- TAX-SHELTERED ANNUITIES
The Code limits the withdrawal of amounts attributable to Purchase Payments made
under a salary reduction agreement by Contract Owners from Tax-Sheltered
Annuities. Withdrawals can only be made when a Contract Owner:
1) reaches age 59 1/2;
2) leaves his/her job;
3) dies;
4) becomes disabled (as that term is defined in the Code); or
5) in the case of hardship. However, in the case of hardship, the Contract
Owner can only withdraw the Purchase Payments and not any earnings.
DIVERSIFICATION
The Code provides that the underlying investments for a variable annuity must
satisfy certain diversification requirements in order to be treated as an
annuity contract. Allianz Life believes that the Portfolios are being managed so
as to comply with the requirements.
Neither the Code nor the Internal Revenue Service Regulations issued to date
provide guidance as to the circumstances under which you, because of the degree
of control you exercise over the underlying investments, and not Allianz Life,
would be considered the owner of the shares of the Portfolios. If you are
considered the owner of the shares, it will result in the loss of the favorable
tax treatment for the Contract. It is unknown to what extent under federal tax
law Contract Owners are permitted to select Portfolios, to make transfers among
the Portfolios or the number and type of Portfolios Contract Owners may select
from without being considered the owner of the shares. If any guidance is
provided which is considered a new position, then the guidance would generally
be applied prospectively. However, if such guidance is considered not to be a
new position, it may be applied retroactively. This would mean that you, as the
Owner of the Contract, could be treated as the owner of the Portfolios.
Due to the uncertainty in this area, Allianz Life reserves the right to modify
the Contract in an attempt to maintain favorable tax treatment.
7. ACCESS TO YOUR MONEY
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You can have access to the money in your Contract:
1) by making a withdrawal (either a partial or a total withdrawal);
2) by receiving Annuity Payments; or
3) when a death benefit is paid to your Beneficiary.
Withdrawals can only be made during the Accumulation Phase.
When you make a complete withdrawal you will receive the value of the Contract
on the day you make the withdrawal, less any applicable contingent deferred
sales charge, less any premium tax and less any contract maintenance charge.
(See Section 5 -- "Expenses" for a discussion of the charges.) Under certain
circumstances, Allianz Life may take back the Loyalty Bonus if you make a
withdrawal or surrender (including under the systematic withdrawal program and
the minimum distribution program) your Contract within 5 years after the Bonus
is credited to your Contract.
Any partial withdrawal must be for at least $500. Unless you instruct Allianz
Life otherwise, a partial withdrawal will be made pro-rata from all the Variable
Options and the Fixed Account you selected. After you make a partial withdrawal,
the value of your Contract must be at least $2,000.
We will pay the amount of any withdrawal from the Variable Options within seven
(7) days of when we receive your request in good order unless the Suspension of
Payments or Transfers provision is in effect (see below).
INCOME TAXES, TAX PENALTIES AND CERTAIN RESTRICTIONS MAY APPLY TO ANY WITHDRAWAL
YOU MAKE.
There are limits to the amount you can withdraw from a Qualified plan referred
to as a 403(b) plan. For a more complete explanation see Section 6 -- "Taxes"
and the discussion in the SAI.
SYSTEMATIC WITHDRAWAL PROGRAM
If the value of your Contract is at least $25,000, Allianz Life offers a program
which provides automatic monthly or quarterly payments to you each year. The
total systematic withdrawals which you can make each year without Allianz Life
deducting a contingent deferred sales charge are limited to 15% of the value of
your Contract. This is determined on the last business day prior to the day your
request is received. You may withdraw any amount you want under this program if
your payments are no longer subject to the contingent deferred sales charge. If
you make withdrawals under this program, you may not also use the 15% free
withdrawal amount that year. For a discussion of the contingent deferred sales
charge and the 15% free withdrawal amount, see Section 5 -- "Expenses." All
systematic withdrawals will be made on the 9th day of the month unless that day
is not a business day. If it is not, then the withdrawal will be made the
previous business day.
INCOME TAXES, TAX PENALTIES AND CERTAIN RESTRICTIONS MAY APPLY TO SYSTEMATIC
WITHDRAWALS.
MINIMUM DISTRIBUTION PROGRAM
If you own a Contract that is an Individual Retirement Annuity (IRA), you may
select the Minimum Distribution Program. Under this program, Allianz Life will
make payments to you from your Contract that are designed to meet the applicable
minimum distribution requirements imposed by the Code for IRAs. If the value of
your Contract is at least $25,000, Allianz Life will make payments to you on a
monthly or quarterly basis. The payments will not be subject to the contingent
deferred sales charge and will be instead of the 15% free withdrawal amount.
SUSPENSION OF PAYMENTS OR TRANSFERS
Allianz Life may be required to suspend or postpone payments for withdrawals or
transfers for any period when:
1) the New York Stock Exchange is closed (other than customary weekend and
holiday closings);
2) trading on the New York Stock Exchange is restricted;
3) an emergency exists as a result of which disposal of the Portfolio shares is
not reasonably practicable or Allianz Life cannot reasonably value the Portfolio
shares;
4) during any other period when the Securities and Exchange Commission, by
order, so permits for the protection of Contract Owners.
Allianz Life has reserved the right to defer payment for a withdrawal or
transfer from the Fixed Account for the period permitted by law but not for more
than six months.
8.PERFORMANCE
--------------------------------------------------------------------------------
Allianz Life periodically advertises performance of the Variable Options.
Allianz Life will calculate performance by determining the percentage change in
the value of an Accumulation Unit by dividing the increase (decrease) for that
unit by the value of the Accumulation Unit at the beginning of the period. This
performance number reflects the deduction of the insurance charges and the
Portfolio expenses. It may not reflect the deduction of any applicable
contingent deferred sales charges and contract maintenance charge. The deduction
of any applicable contract maintenance charge and contingent deferred sales
charges would reduce the percentage increase or make greater any percentage
decrease. Any advertisement will also include average annual total return
figures which reflect the deduction of the insurance charges, contract
maintenance charge, contingent deferred sales charges and the expenses of the
Portfolios. Allianz Life may also advertise cumulative total return information.
Cumulative total return is determined the same way except that the results are
not annualized. Performance information for the underlying Portfolios may also
be advertised; see the accompanying fund prospectuses for more information.
Certain Portfolios have been in existence for some time and have investment
performance history. In order to demonstrate how the actual investment
experience of the Portfolios may affect your Accumulation Unit values, Allianz
Life has prepared performance information which can be found in the SAI. There
is performance shown which is based on the historical performance of the
Portfolios, modified to reflect the current charges and expenses of your
Contract as if the Contract had been in existence for the time periods shown.
The information is based upon the historical experience of the Portfolios and
does not represent past performance or predict future performance.
Allianz Life may in the future also advertise yield information. If it does, it
will provide you with information regarding how yield is calculated. More
detailed information regarding how performance is calculated is found in the
SAI.
Any performance advertised will be based on historical data. It does not
guarantee future results of the Portfolios.
9. DEATH BENEFIT
--------------------------------------------------------------------------------
UPON YOUR DEATH
If you die during the Accumulation Phase, Allianz Life will pay a death benefit
to your Beneficiary (see below). If you die during the Payout Phase, any benefit
will be as provided for in the Annuity Option selected. If you purchase the
Contract on or after July 6, 1999, you may choose Death Benefit Option 1 or
Death Benefit Option 2 at the time of application. Once you make the selection,
you may not change it. If you purchased the Contract before July 6, 1999, Death
Benefit Option 2 is not available. Under certain circumstances, we may take back
the Bonus before calculating the death benefit amount. (See "Purchase -
Bonuses").
I. CONTRACTS THAT RECEIVE AN ENHANCED DEATH BENEFIT ENDORSEMENT
Contracts that are owned individually, or jointly with another person, or
as agent for an individual person, will receive an enhanced death benefit
endorsement for Death Benefit Option 1 or Death Benefit Option 2. For these
Contracts, the death benefit options are:
DEATH BENEFIT OPTION 1
The death benefit will be the greater of 1) or 2) below:
1) The current value of your Contract, less any premium taxes owed. This
amount is determined as of the day that all claim proofs and payment election
forms are received at the USAllianz Service Center.
2) The guaranteed minimum death benefit (as explained below and in the enhanced
death benefit endorsement to your Contract), as of the day you die.
A. During the first year of all such Contracts and if you are age 81 or older
(76 or older for deaths occurring in Washington, or in most other states before
11/1/98) at the time of purchase, the following guaranteed minimum death benefit
will apply:
o Purchase Payments you have made,
o less any withdrawals,
o less any applicable charges paid on withdrawals,
o less any premium taxes owed.
B. After the first Contract year, for Contracts issued before your 81st
birthday (76th birth- day for deaths occurring before 11/1/98), and until you
reach age 81 (age 76 for deaths occurring before 11/1/98), the greater of (a) or
(b) below will be your guaranteed minimum death benefit:
a) 5% Increase
o Purchase Payments you have made,
o less any withdrawals,
o less any applicable charges paid on withdrawals,
o plus 5% on each Contract anniversary,
o less any premium taxes owed.
b) Highest 6th Year Contract Value
o highest Contract value on any six year Contract anniversary,
o plus any Purchase Payments made since that Contract anniversary,
o less any withdrawals since that anniversary,
o less any applicable charges paid on withdrawals since that
anniversary,
o less any premium taxes owed.
C. After your 81st birthday (76th birthday for deaths occurring before 11/1/98),
the following guaranteed minimum death benefit will apply:
o your guaranteed minimum death benefit on the Contract anniversary
prior to your 81st birthday (76th birthday for deaths occurring
before 11/1/98),
o plus any Purchase Payments you have made since then,
o less any withdrawals since then,
o less any applicable charges paid on withdrawals since then,
o less any premium taxes owed.
DEATH BENEFIT OPTION 2
The death benefit will be the greater of:
1) the current value of your Contract, less any taxes, on the day all claim
proofs and payment election forms are received by Allianz Life at the USAllianz
Service Center; or
2) (if applicable) the guaranteed minimum death benefit, less any taxes, on the
day all claim proofs and payment election forms are received by Allianz Life
at the USAllianz Service Center.
The guaranteed minimum death benefit is the greater of:
o Purchase Payments you have made, less any withdrawals and any charges
paid on the withdrawals.
o the greatest Contract "anniversary value". The Contract "anniversary
value" is the value of the Contract on a Contract anniversary, increased by
Purchase Payments you have made since that anniversary and decreased by any
withdrawals and any charges paid on the withdrawals since that anniversary.
Allianz Life will not take into consideration any Contract anniversaries
which occur on or after your 81st birthday or date of death in determining
this benefit.
In certain states, the above death benefit may not be available. Check your
Contract and Endorsement for your applicable death benefit.
II. CONTRACTS THAT DO NOT RECEIVE AN ENHANCED DEATH BENEFIT ENDORSEMENT
For all Contracts that do not receive an enhanced death benefit endorsement, the
death benefit will be:
The current value of your Contract, less any taxes owed. This amount is
determined as of the day that all claim proofs and payment election forms are
received at the USAllianz Service Center.
III. ADDITIONAL PROVISIONS
If you have a Joint Owner, the age of the older Contract Owner will be used to
determine the guaranteed minimum death benefit. The guaranteed minimum death
benefit will be reduced by any amounts withdrawn after the date of death. If the
Contract is owned by a non-natural person, then all references to you mean the
Annuitant.
In the case of Joint Owners, if a Joint Owner dies, the surviving Joint Owner
will be the Beneficiary. Joint Owners must be spouses (except in Pennsylvania,
Oregon and New Jersey).
A Beneficiary may request that the death benefit be paid in one of the following
ways: (1) Payment of the entire death benefit within 5 years of the date of
death, or (2) Payment of the death benefit under an Annuity Option. The death
benefit payable under an Annuity Option must be paid over the Beneficiary's
lifetime or for a period not extending beyond the Beneficiary's life expectancy.
Payment must begin within one year of the date of death, or (3) If the
Beneficiary is the spouse of the Contract Owner, he/she can choose to continue
the Contract in his/her own name at the then current value, or if greater, the
death benefit value, or (4) If a lump sum payment is elected and all the
necessary requirements, including any required tax consent from some states, are
met, the payment will be made within 7 days. Payment of the death benefit may be
delayed pending receipt of any applicable tax consents and/or forms from a
state.
If you (or any Joint Owner) die during the Payout Phase and you are not the
Annuitant, any payments which are remaining under the Annuity Option selected
will continue at least as rapidly as they were being paid at your death. If you
die during the Payout Phase, the Beneficiary becomes the Contract Owner.
DEATH OF ANNUITANT
If the Annuitant, who is not a Contract Owner or Joint Owner, dies during the
Accumulation Phase, you can name a new Annuitant. If you do not name a new
Annuitant within 30 days of the death of the Annuitant, you will become the
Annuitant. However, if the Contract Owner is a non-natural person (e.g., a
corporation), then the death of the Annuitant will be treated as the death of
the Contract Owner, and a new Annuitant may not be named.
If the Annuitant dies after Annuity Payments have begun, the remaining amounts
payable, if any, will be as provided for in the Annuity Option selected. The
remaining amounts payable will be paid to the Contract Owner at least as rapidly
as they were being paid at the Annuitant's death.
10. OTHER INFORMATION
--------------------------------------------------------------------------------
ALLIANZ LIFE
Allianz Life Insurance Company of North America (Allianz Life), 1750 Hennepin
Avenue, Minneapolis, Minnesota 55403, was organized under the laws of the state
of Minnesota in 1896. Allianz Life offers fixed and variable life insurance and
annuities and group life, accident and health insurance. Allianz Life is
licensed to do direct business in 49 states and the District of Columbia.
Allianz Life is a wholly-owned subsidiary of Allianz Versicherungs-AG Holding.
THE SEPARATE ACCOUNT
Allianz Life established a separate account named Allianz Life Variable Account
B (Separate Account) to hold the assets that underlie the Contracts, except
assets allocated to the Fixed Account. The Board of Directors of Allianz Life
adopted a resolution to establish the Separate Account under Minnesota insurance
law on May 31, 1985. Allianz Life has registered the Separate Account with the
Securities and Exchange Commission as a unit investment trust under the
Investment Company Act of 1940. The Separate Account is divided into Variable
Options (also known as sub-accounts). Each Variable Option invests in a
Portfolio.
The assets of the Separate Account are held in Allianz Life's name on behalf of
the Separate Account and legally belong to Allianz Life. However, those assets
that underlie the variable Contracts are not chargeable with liabilities arising
out of any other business Allianz Life may conduct. All the income, gains and
losses (realized or unrealized) resulting from these assets are credited to or
charged against the Contracts and not against any other contracts Allianz Life
may issue.
DISTRIBUTION
USAllianz Investor Services, LLC (formerly NALAC Financial Plans, LLC), 1750
Hennepin Avenue, Minneapolis, MN 55403, acts as the distributor of the Contract.
USAllianz Investor Services, LLC, is a wholly- owned subsidiary of Allianz Life.
Commissions will be paid to broker-dealers who sell the Contracts.
Broker-dealers will be paid commissions up to 7.5% of Purchase Payments.
Sometimes, Allianz Life enters into an agreement with the broker-dealer to pay
the broker-dealer commissions as a combination of a certain amount of the
commission at the time of sale and a trail commission (which when totaled could
exceed 7.5% of Purchase Payments). In addition, Allianz Life may pay certain
sellers for other services not directly related to the sale of the Contracts
(such as special marketing support allowances). Commissions may be recovered
from a broker-dealer if a withdrawal occurs within 12 months of a Purchase
Payment or there is a recission of the Contract within the Free-Look period.
ADMINISTRATION
Allianz Life has hired Delaware Valley Financial Services, Inc. (DVFS), 300
Berwyn Park, Berwyn, Pennsylvania, to perform certain administrative services
regarding the Contracts. The administrative services include issuance of the
Contracts and maintenance of Contract Owner's records.
FINANCIAL STATEMENTS
The consolidated financial statements of Allianz Life and the Separate Account
have been included in the Statement of Additional Information.
TABLE OF CONTENTS
OF THE STATEMENT OF
ADDITIONAL INFORMATION
--------------------------------------------------------------------------------
Insurance Company
Experts
Legal Opinions
Distributor
Reduction or Elimination of the
Contingent Deferred Sales Charge
Calculation of Performance Data
Federal Tax Status
Annuity Provisions
Mortality and Expense Risk Guarantee
Financial Statements
<PAGE>
25
Variable Annuity Prospectus
<TABLE>
<CAPTION>
APPENDIX
-------------------------------------------------------------------------------
CONDENSED FINANCIAL INFORMATION
The consolidated financial statements of Allianz Life Insurance Company of North
America and the financial statements of Allianz Life Variable Account B may be
found in the Statement of Additional Information.
The table below includes Accumulation Unit values for the periods indicated. The
table reflects Contracts with a mortality and expense risk charge of 1.34%.
This information should be read in conjunction with the financial statements and
related notes of the Separate Account included in the Statement of Additional
Information.
(NUMBER OF UNITS IN THOUSANDS)
PERIOD YEAR OR PERIOD YEAR OR PERIOD INCEPTION
ENDED ENDED ENDED (2/3/97) TO
VARIABLE OPTIONS: ______, 2000 DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1997
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
AIM V.I. GROWTH*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $11.083 NA NA
Number of units outstanding at end of period 363 NA NA
ALGER AMERICAN GROWTH*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $10.921 NA NA
Number of units outstanding at end of period 415 NA NA
ALGER AMERICAN LEVERAGED ALLCAP*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $12.159 NA NA
Number of units outstanding at end of period 277 NA NA
FRANKLIN GLOBAL COMMUNICATIONS SECURITIES
Unit value at beginning of period $28.082 $25.635 $20.526
Unit value at end of period $38.572 $28.082 $25.635
Number of units outstanding at end of period 1,418 1,006 310
FRANKLIN GLOBAL HEALTH CARE SECURITIES
Unit value at beginning of period $10.604 $10.000 NA
Unit value at end of period $9.601 $10.604 NA
Number of units outstanding at end of period 469 224 NA
FRANKLIN GROWTH AND INCOME SECURITIES
Unit value at beginning of period $25.993 $24.354 $19.351
Unit value at end of period $25.891 $25.993 $24.354
Number of units outstanding at end of period 5,570 5,185 2,376
FRANKLIN HIGH INCOME
Unit value at beginning of period $21.020 $21.141 $19.237
Unit value at end of period $20.695 $21.020 $21.141
Number of units outstanding at end of period 4,118 4,191 2,202
FRANKLIN INCOME SECURITIES
Unit value at beginning of period $24.898 $24.864 $21.554
Unit value at end of period $24.084 $24.898 $24.864
Number of units outstanding at end of period 4,380 4,239 2,094
(NUMBER OF UNITS IN THOUSANDS)
YEAR OR PERIOD YEAR OR PERIOD INCEPTION
ENDED ENDED (2/3/97) TO
VARIABLE OPTIONS: DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1997
---------------------------------------------------------------------------------------------------------------------------
FRANKLIN LARGE CAP GROWTH SECURITIES
Unit value at beginning of period $15.537 $13.110 $11.247
Unit value at end of period $20.152 $15.537 $13.110
Number of units outstanding at end of period 7,521 4,502 1,957
FRANKLIN MONEY MARKET
Unit value at beginning of period $14.260 $13.756 $13.266
Unit value at end of period $14.717 $14.260 $13.756
Number of units outstanding at end of period 5,236 4,342 3,214
FRANKLIN NATURAL RESOURCES SECURITIES
Unit value at beginning of period $8.430 $11.466 $14.364
Unit value at end of period $10.983 $8.430 $11.466
Number of units outstanding at end of period 616 514 304
FRANKLIN REAL ESTATE
Unit value at beginning of period $22.901 $27.944 $23.499
Unit value at end of period $21.176 $22.901 $27.944
Number of units outstanding at end of period 1,490 1,823 1,217
FRANKLIN RISING DIVIDENDS SECURITIES
Unit value at beginning of period $21.034 $19.968 $15.235
Unit value at end of period $18.712 $21.034 $19.968
Number of units outstanding at end of period 4,137 4,428 1,991
FRANKLIN S&P 500 INDEX*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $10.465 NA NA
Number of units outstanding at end of period 626 NA NA
FRANKLIN SMALL CAP
Unit value at beginning of period $14.558 $14.923 $12.899
Unit value at end of period $28.247 $14.558 $14.923
Number of units outstanding at end of period 5,460 5,492 2,965
FRANKLIN U.S. GOVERNMENT
Unit value at beginning of period $18.847 $17.805 $16.533
Unit value at end of period $18.394 $18.847 $17.805
Number of units outstanding at end of period 3,857 3,040 1,359
FRANKLIN VALUE SECURITIES
Unit value at beginning of period $7.713 $10.000 NA
Unit value at end of period $7.724 $7.713 NA
Number of units outstanding at end of period 603 367 NA
FRANKLIN ZERO COUPON 2000
Unit value at beginning of period $20.502 $19.358 $18.345
Unit value at end of period $20.819 $20.502 $19.358
Number of units outstanding at end of period 282 188 94
FRANKLIN ZERO COUPON 2005
Unit value at beginning of period $24.786 $22.357 $20.375
Unit value at end of period $22.983 $24.786 $22.357
Number of units outstanding at end of period 555 380 161
27
Variable Annuity Prospectus
NUMBER OF UNITS IN THOUSANDS)
YEAR OR PERIOD YEAR OR PERIOD INCEPTION
ENDED ENDED (2/3/97) TO
VARIABLE OPTIONS: DEC. 31, 1999 DEC. 31, 1998 DEC. 31, 1997
---------------------------------------------------------------------------------------------------------------------------
FRANKLIN ZERO COUPON 2010
Unit value at beginning of period $27.674 $24.544 $21.371
Unit value at end of period $23.929 $27.674 $24.544
Number of units outstanding at end of period 668 478 150
MUTUAL DISCOVERY SECURITIES
Unit value at beginning of period $11.205 $11.971 $10.179
Unit value at end of period $13.662 $11.205 $11.971
Number of units outstanding at end of period 7,820 8,822 5,461
MUTUAL SHARES SECURITIES
Unit value at beginning of period $11.814 $11.981 $10.329
Unit value at end of period $13.199 $11.814 $11.981
Number of units outstanding at end of period 18,924 19,834 11,394
TEMPLETON ASSET STRATEGY
Unit value at beginning of period $13.543 $13.752 $12.495
Unit value at end of period $14.347 $13.543 $13.752
Number of units outstanding at end of period 1,403 1,491 1,008
TEMPLETON DEVELOPING MARKETS SECURITIES
Unit value at beginning of period $7.958 $10.305 $11.458
Unit value at end of period $12.125 $7.958 $10.305
Number of units outstanding at end of period 3,389 3,425 2,663
TEMPLETON GLOBAL INCOME SECURITIES
Unit value at beginning of period $17.746 $16.821 $16.661
Unit value at end of period $16.472 $17.746 $16.821
Number of units outstanding at end of period 657 651 393
TEMPLETON GROWTH SECURITIES
Unit value at beginning of period $16.238 $15.124 $13.525
Unit value at end of period $19.364 $16.238 $15.124
Number of units outstanding at end of period 9,008 8,864 5,525
TEMPLETON INTERNATIONAL SECURITIES
Unit value at beginning of period $18.322 $17.617 $16.010
Unit value at end of period $22.858 $18.322 $17.617
Number of units outstanding at end of period 4,164 4,427 3,122
TEMPLETON INTERNATIONAL SMALLER COMPANIES
Unit value at beginning of period $9.342 $10.809 $11.138
Unit value at end of period $11.403 $9.342 $10.809
Number of units outstanding at end of period 865 967 792
TEMPLETON PACIFIC GROWTH SECURITIES
Unit value at beginning of period $8.028 $9.381 $14.866
Unit value at end of period $10.838 $8.028 $9.381
Number of units outstanding at end of period 1,041 655 379
USALLIANZ VIP DIVERSIFIED ASSETS*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $10.168 NA NA
Number of units outstanding at end of period 1 NA NA
USALLIANZ VIP FIXED INCOME*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $9.749 NA NA
Number of units outstanding at end of period 1 NA NA
USALLIANZ VIP GROWTH*
Unit value at beginning of period $10.000 NA NA
Unit value at end of period $10.731 NA NA
Number of units outstanding at end of period 10 NA NA
<FN>
*The AIM V.I. Growth, Alger American Growth, Alger American Leveraged AllCap,
Franklin S&P 500 Index ,USAllianz VIP Diversified Assets, USAllianz VIP Fixed
Income and USAllianz VIP Growth Sub-Accounts commenced operations with the
Separate Account on November 12, 1999. Unit Values at inception were $10.00.
There are no accumulation units shown for the Franklin Aggressive Growth
Securities Sub-Account and the Franklin Technology Securities Sub-Account
because they commenced operations on May 1, 2000 and therefore had no assets as
of ______________, 2000.
</FN>
</TABLE>
PART B
STATEMENT OF ADDITIONAL INFORMATION
VALUEMARK IV PLUS
INDIVIDUAL FLEXIBLE PAYMENT
VARIABLE ANNUITY CONTRACTS
issued by
ALLIANZ LIFE VARIABLE ACCOUNT B
and
ALLIANZ LIFE INSURANCE COMPANY OF NORTH AMERICA
__________, 2000
THIS IS NOT A PROSPECTUS. THIS STATEMENT OF ADDITIONAL INFORMATION SHOULD BE
READ IN CONJUNCTION WITH THE PROSPECTUS FOR THE INDIVIDUAL FLEXIBLE PAYMENT
VARIABLE ANNUITY CONTRACTS WHICH ARE REFERRED TO HEREIN.
THE PROSPECTUS CONCISELY SETS FORTH INFORMATION THAT A PROSPECTIVE INVESTOR
OUGHT TO KNOW BEFORE INVESTING. FOR A COPY OF THE PROSPECTUS, CALL OR WRITE THE
INSURANCE COMPANY AT: 1750 Hennepin Avenue, Minneapolis, MN 55403-2195, (800)
542-5427.
THIS STATEMENT OF ADDITIONAL INFORMATION AND THE PROSPECTUS ARE DATED _______,
2000, AND AS MAY BE AMENDED FROM TIME TO TIME.
Table of Contents
Contents Page
Insurance Company ...............................
Experts .........................................
Legal Opinions ..................................
Distributor .....................................
Reduction or Elimination of the
Contingent Deferred Sales Charge ...............
Calculation of Performance Data .................
Federal Tax Status ..............................
Annuity Provisions ..............................
Mortality and Expense Risk Guarantee ............
Financial Statements ............................
Insurance Company
-------------------------------------------------------------------------------
Allianz Life Insurance Company of North America (the "Insurance Company") is a
stock life insurance company organized under the laws of the state of Minnesota
in 1896. The Insurance Company is a wholly-owned subsidiary of Allianz
Versicherungs-AG Holding ("Allianz"). Allianz is headquartered in Munich,
Germany, and has sales outlets throughout the world. The Insurance Company
offers fixed and variable life insurance and annuities, and group life, accident
and health insurance.
The Insurance Company is rated A++ by A.M. BEST, an independent analyst of the
insurance industry. The financial strength of an insurance company may be
relevant in that it may be a reflection as to the ability of a company to make
fixed annuity payments from its general account.
Experts
-------------------------------------------------------------------------------
The financial statements of Allianz Life Variable Account B and the consolidated
financial statements of the Insurance Company as of and for the year ended
December 31, 1999 included in this Statement of Additional Information have been
audited by ____________, independent auditors, as indicated in their reports
included in this Statement of Additional Information and are included herein in
reliance upon such reports and upon the authority of said firm as experts in
accounting and auditing.
Legal Opinions
------------------------------------------------------------------------------
Blazzard, Grodd & Hasenauer, P.C., Westport, Connecticut has provided advice on
certain matters relating to the federal securities and income tax laws in
connection with the Contracts.
Distributor
-------------------------------------------------------------------------------
USAllianz Investor Services, LLC (formerly NALAC Financial Plans, LLC), a
subsidiary of the Insurance Company, acts as the distributor. The offering is on
a continuous basis.
Reduction or Elimination of the
Contingent Deferred Sales Charge
-------------------------------------------------------------------------------
The amount of the contingent deferred sales charge on the Contracts may be
reduced or eliminated when sales of the Contracts are made to individuals or to
a group of individuals in a manner that results in savings of sales expenses.
The entitlement to a reduction of the contingent deferred sales charge will be
determined by the Insurance Company after examination of the following factors:
1) the size of the group; 2) the total amount of Purchase Payments expected to
be received from the group; 3) the nature of the group for which the Contracts
are purchased, and the persistency expected in that group; 4) the purpose for
which the Contracts are purchased and whether that purpose makes it likely that
expenses will be reduced; and 5) any other circumstances which the Insurance
Company believes to be relevant to determining whether reduced sales or
administrative expenses may be expected. None of the reductions in charges for
sales is contractually guaranteed.
The contingent deferred sales charge may be eliminated when the Contracts are
issued to an officer, director or employee of the Insurance Company or any of
its affiliates. The contingent deferred sales charge may be reduced or
eliminated when the Contract is sold by an agent of the Insurance Company to any
members of his or her immediate family and the commission is waived. In no event
will any reduction or elimination of the contingent deferred sales charge be
permitted where the reduction or elimination will be unfairly discriminatory to
any person.
Calculation of Performance Data
------------------------------------------------------------------------------
Total Return
From time to time, the Insurance Company may advertise the performance data for
the Variable Options in sales literature, advertisements, personalized
hypothetical illustrations, and Contract Owner communications. Such data will
show the percentage change in the value of an Accumulation Unit based on the
performance of a Portfolio over a stated period of time which is determined by
dividing the increase (or decrease) in value for that unit by the Accumulation
Unit value at the beginning of the period.
Any such performance data will include total return figures for the one, five,
and ten year (or since inception) time periods indicated. Such total return
figures will reflect the deduction of the mortality and expense risk charge,
the administrative charge, the operating expenses of the underlying
Portfolios and any applicable contingent deferred sales charge and contract
maintenance charge ("Standardized Total Return"). The contingent deferred sales
charge and contract maintenance charge deductions are calculated assuming a
Contract is surrendered at the end of the reporting period. Standardized total
return figures will be shown assuming no benefits were selected (no Bonuses and
no GMIB) as well as assuming all benefits were selected (Immediate Bonus,
Loyalty Bonus and GMIB).
The hypothetical value of a Contract purchased for the time periods described
will be determined by using the actual Accumulation Unit values for an initial
$1,000 Purchase Payment, and deducting any applicable contract maintenance
charges and any applicable contingent deferred sales charges to arrive at the
ending hypothetical value. The average annual total return is then determined by
computing the fixed interest rate that a $1,000 Purchase Payment would have to
earn annually, compounded annually, to grow to the hypothetical value at the end
of the time periods described. The formula used in these calculations is:
P(1+T)n = ERV
where:
P = a hypothetical initial payment of $1,000;
T = average annual total return;
n = number of years;
ERV = ending redeemable value of a hypothetical $1,000 payment made at the
beginning of the time periods used at the end of such time periods (or
fractional portion thereof).
The Insurance Company may also advertise performance data which will be
calculated in the same manner as described above but which will not reflect the
deduction of the contingent deferred sales charge and the contract maintenance
charge. The Insurance Company may also advertise cumulative and average total
return information over different periods of time. The Company may also present
performance information computed on a different basis ("Non-Standardized Total
Return").
Cumulative total return is calculated in a similar manner, except that the
results are not annualized. Each calculation assumes that no sales load is
deducted from the initial $1,000 payment at the time it is allocated to the
Portfolios and assumes that the income earned by the investment in the Portfolio
is reinvested.
Contract Owners should note that investment results will fluctuate over time,
and any presentation of total return for any period should not be considered as
a representation of what an investment may earn or what a Contract Owner's total
return may be in any future period.
Yield
The Franklin Money Market Fund. The Insurance Company may advertise yield
information for the Franklin Money Market Fund. The Franklin Money Market Fund's
current yield may vary each day, depending upon, among other things, the average
maturity of the underlying Portfolio's investment securities and changes in
interest rates, operating expenses, the deduction of the mortality and expense
risk charge, the administrative charge and the contract maintenance charge and,
in certain instances, the value of the underlying Portfolio's investment
securities. The fact that the Portfolio's current yield will fluctuate and that
the principal is not guaranteed should be taken into consideration when using
the Portfolio's current yield as a basis for comparison with savings accounts or
other fixed-yield investments. The yield at any particular time is not
indicative of what the yield may be at any other time.
The Franklin Money Market Fund's current yield is computed on a base period
return of a hypothetical Contract having a beginning balance of one Accumulation
Unit for a particular period of time (generally seven days). The return is
determined by dividing the net change (exclusive of any capital changes) in such
Accumulation Unit by its beginning value, and then multiplying it by 365/7 to
get the annualized current yield. The calculation of net change reflects the
value of additional shares purchased with the dividends paid by the Portfolio,
and the deduction of the mortality and expense risk charge, the administrative
charge and contract maintenance charge. The effective yield reflects the effects
of compounding and represents an annualization of the current return with all
dividends reinvested.
(Effective yield = [(Base Period Return + 1)365/7] - 1.)
For the seven-day period ending on _________, 2000, the Franklin Money Market
Sub-Account had a current yield of 4.21% and an effective yield of ____%. The
yield information assumes that the Contract Sub-Account was invested in the
Franklin Money Market Fund for the time period shown.
Other Variable Options. The Insurance Company may also quote yield in sales
literature, advertisements, personalized hypothetical illustrations, and
Contract Owner communications for the other Variable Options. Each Variable
Options (other than the Franklin Money Market Fund) will publish standardized
total return information with any quotation of current yield.
The yield computation is determined by dividing the net investment income per
Accumulation Unit earned during the period (minus the deduction for the
mortality and expense risk charge, administrative charge and contract
maintenance charge) by the Accumulation Unit value on the last day of the period
and annualizing the resulting figure, according to the following formula:
6
Yield = 2[(a-b + 1) - 1]
--
cd
where:
a = net investment income earned during the period by the Variable Options
attributable to shares owned by the Portfolio;
b = expenses accrued for the period (net of reimbursements);
c = the average daily number of Accumulation Units outstanding during the
period;
d = the maximum offering price per Accumulation Unit on the last day of the
period.
The above formula will be used in calculating quotations of yield, based on
specified 30-day periods (or one month) identified in the sales literature,
advertisement, or communication. Yield calculations assume no sales load. The
Insurance Company does not currently advertise yield information for any
Variable Option (other than the Franklin Money Market Fund).
Performance Ranking
Total return may be compared to relevant indices, including U.S. domestic and
international indices and data from Lipper Analytical Services, Inc., Standard &
Poor's Indices, or VARDS(R). From time to time, evaluation of performance by
independent sources may also be used.
Performance Information
In order to show how investment performance of the Portfolios affects
Accumulation Unit values, the following performance information was developed.
Effective May 1, 2000, the Templeton International Securities Fund (a fund of
Templeton Variable Products Series Fund) merged into the Templeton International
Equity Fund. The performance shown in the charts below reflects the historical
performance of the Templeton International Equity Fund. Effective May 1, 2000,
the Templeton Developing Markets Securities Fund (a fund of Templeton Variable
Series Products Fund) merged into the Templeton Developing Markets Equity Fund.
The performance shown in the charts below reflects the historical performance of
the Templeton Developing Markets Equity Fund. Effective May 1, 2000, the
Templeton Asset Strategy Fund (a fund of Templeton Variable Series Fund) merged
into the Templeton Global Asset Allocation Fund. The performance shown in the
charts below reflects the historical performance of the Templeton Global Asset
Allocation Fund.
The charts below show Accumulation Unit performance which assumes that the
Accumulation Units were invested in each of the Portfolios for the same periods.
The performance figures in Table I represent performance figures for the
Accumulation Units which reflects the deduction of the mortality and expense
risk charge, administrative charge, and the operating expenses of the
Portfolios. Table II and Table III represent performance figures for the
Accumulation Units which reflects the mortality and expense risk charge,
administrative charge, the contract maintenance charge, the operating expenses
of the Portfolios and assumes that you make a withdrawal at the end of the
period (therefore the contingent deferred sales charge is reflected). Table II
assumes no benefits (no Bonuses and no GMIB) were selected and Table III assumes
all benefits (Immediate Bonus, Loyalty Bonus and GMIB) were selected. Past
performance does not guarantee future results.
<TABLE>
<CAPTION>
Valuemark IV Plus
Table I: Total Return for the periods ended ____________, 2000
---------------------------------------------------------------------------------------------------------------------------
Sub-Account
Inception One Three Five Ten Since
Variable Option Date Year Years Years Years Inception
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
AIM V.I. Growth 11/12/99 % _____% _____% _____% _____%
Alger American Growth 11/12/99 % _____% _____% _____% _____%
Alger American Leveraged AllCap 11/12/99 _____% _____% _____% _____% _____%
Franklin Global Communications
Securities, Class 1 1/24/89 _____%** _____% _____% _____% _____%
Franklin Global Health Care Securities,
Class 1 5/1/98 _____% _____% _____% _____% _____%
Franklin Growth and Income Securities,
Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin High Income, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Income Securities, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Large Cap Growth Securities,
Class 1 5/1/96 _____% _____% _____% _____% _____%
Franklin Money Market, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Natural Resources Securities,
Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Real Estate, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Rising Dividends Securities,
Class 1 1/27/92 _____% _____% _____% _____% _____%
Franklin Small Cap, Class 1 11/01/95 _____%** _____% _____% _____% _____%
Franklin S&P 500 Index, Class 1 11/12/99 _____% _____% _____% _____% _____%
Franklin U.S. Government, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Value Securities, Class 1 5/1/98 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2000, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2005, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2010, Class 1 3/14/89 _____% _____% _____% _____% _____%
Mutual Discovery Securities, Class 1 11/08/96 _____% _____% _____% _____% _____%
Mutual Shares Securities, Class 1 11/08/96 _____% _____% _____% _____% _____%
Templeton Asset Strategy, Class 1 5/1/95 _____% _____% _____% _____% _____%
Templeton Developing Markets Securities,
Class 1 3/15/94 _____% _____% _____% _____% _____%
Templeton Global Income Securities, Class 1 1/24/89 _____% _____% _____% _____% _____%
Templeton Growth Securities, Class 1 3/15/94 _____% _____% _____% _____% _____%
Templeton International Securities, Class 1 1/27/92 _____% _____% _____% _____% _____%
Templeton International
Smaller Companies, Class 1 5/01/96 _____% _____% _____% _____% _____%
Templeton Pacific Growth Securities,
Class 1 1/27/92 _____% _____% _____% _____% _____%
USAllianz VIP Diversified Assets 11/12/99 _____% _____% _____% _____% _____%
USAllianz VIP Fixed Income 11/12/99 __% _____% _____% _____% _____%
USAllianz VIP Growth 11/12/99 _____% _____% _____% _____% _____%
</TABLE>
<TABLE>
<CAPTION>
Table II: Total Return for the periods ended ___________, 2000
---------------------------------------------------------------------------------------------------------------------------
Sub-Account
Inception One Three Five Ten Since
Variable Option Date Year Years Years Years Inception
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
AIM V.I. Growth 11/12/99 _____% _____% _____% _____% _____%
Alger American Growth 11/12/99 _____% _____% _____% _____% _____%
Alger American Leveraged AllCap 11/12/99 _____% _____% _____% _____% _____%
Franklin Global Communications
Securities, Class 1 1/24/89 _____%** _____% _____% _____% _____%
Franklin Global Health Care Securities,
Class 1 5/1/98 _____% _____% _____% _____% _____%
Franklin Growth and Income Securities,
Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin High Income, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Income Securities, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Large Cap Growth Securities,
Class 1 5/1/96 _____% _____% _____% _____% _____%
Franklin Money Market, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Natural Resources Securities,
Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Real Estate, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Rising Dividends Securities,
Class 1 1/27/92 _____% _____% _____% _____% _____%
Franklin Small Cap, Class 1 11/01/95 _____%** _____% _____% _____% _____%
Franklin S&P 500 Index, Class 1 11/12/99 _____% _____% _____% _____% _____%
Franklin U.S. Government, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Value Securities, Class 1 5/1/98 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2000, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2005, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2010, Class 1 3/14/89 _____% _____% _____% _____% _____%
Mutual Discovery Securities, Class 1 11/08/96 _____% _____% _____% _____% _____%
Mutual Shares Securities, Class 1 11/08/96 _____% _____% _____% _____% _____%
Templeton Asset Strategy, Class 1 5/1/95 _____% _____% _____% _____% _____%
Templeton Developing Markets Securities,
Class 1 3/15/94 _____% _____% _____% _____% _____%
Templeton Global Income Securities, Class 1 1/24/89 _____% _____% _____% _____% _____%
Templeton Growth Securities, Class 1 3/15/94 _____% _____% _____% _____% _____%
Templeton International Securities, Class 1 1/27/92 _____% _____% _____% _____% _____%
Templeton International
Smaller Companies, Class 1 5/01/96 _____% _____% _____% _____% _____%
Templeton Pacific Growth Securities,
Class 1 1/27/92 _____% _____% _____% _____% _____%
USAllianz VIP Diversified Assets 11/12/99 _____% _____% _____% _____% _____%
USAllianz VIP Fixed Income 11/12/99 _____% _____% _____% _____% _____%
USAllianz VIP Growth 11/12/99 _____% _____% _____% _____% _____%
</TABLE>
<TABLE>
<CAPTION>
Table III: Total Return for the periods ended ___________, 2000
---------------------------------------------------------------------------------------------------------------------------
Sub-Account
Inception One Three Five Ten Since
Variable Option Date Year Years Years Years Inception
---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
AIM V.I. Growth 11/12/99 _____% _____% _____% _____% _____%
Alger American Growth 11/12/99 _____% _____% _____% _____% _____%
Alger American Leveraged AllCap 11/12/99 _____% _____% _____% _____% _____%
Franklin Global Communications
Securities, Class 1 1/24/89 _____%** _____% _____% _____% _____%
Franklin Global Health Care Securities,
Class 1 5/1/98 _____% _____% _____% _____% _____%
Franklin Growth and Income Securities,
Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin High Income, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Income Securities, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Large Cap Growth Securities,
Class 1 5/1/96 _____% _____% _____% _____% _____%
Franklin Money Market, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Natural Resources Securities,
Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Real Estate, Class 1 1/24/89 _____% _____% _____% _____% _____%
Franklin Rising Dividends Securities,
Class 1 1/27/92 _____% _____% _____% _____% _____%
Franklin Small Cap, Class 1 11/01/95 _____%** _____% _____% _____% _____%
Franklin S&P 500 Index, Class 1 11/12/99 _____% _____% _____% _____% _____%
Franklin U.S. Government, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Value Securities, Class 1 5/1/98 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2000, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2005, Class 1 3/14/89 _____% _____% _____% _____% _____%
Franklin Zero Coupon - 2010, Class 1 3/14/89 _____% _____% _____% _____% _____%
Mutual Discovery Securities, Class 1 11/08/96 _____% _____% _____% _____% _____%
Mutual Shares Securities, Class 1 11/08/96 _____% _____% _____% _____% _____%
Templeton Asset Strategy, Class 1 5/1/95 _____% _____% _____% _____% _____%
Templeton Developing Markets Securities,
Class 1 3/15/94 _____% _____% _____% _____% _____%
Templeton Global Income Securities, Class 1 1/24/89 _____% _____% _____% _____% _____%
Templeton Growth Securities, Class 1 3/15/94 _____% _____% _____% _____% _____%
Templeton International Securities, Class 1 1/27/92 _____% _____% _____% _____% _____%
Templeton International
Smaller Companies, Class 1 5/01/96 _____% _____% _____% _____% _____%
Templeton Pacific Growth Securities,
Class 1 1/27/92 _____% _____% _____% _____% _____%
USAllianz VIP Diversified Assets 11/12/99 _____% _____% _____% _____% _____%
USAllianz VIP Fixed Income 11/12/99 _____% _____% _____% _____% _____%
USAllianz VIP Growth Sub-Accounts 11/12/99 _____% _____% _____% _____% _____%
</TABLE>
** Recently, many individual stocks and sectors, such as technology, have
significantly exceeded historical norms; investors should generally not
expect such large gains to continue.
The Franklin Aggressive Growth Securities and Franklin Technology Securities
Sub-Accounts commenced operations on May 1, 2000. Therefore no performance is
shown for these Portfolios.
Federal Tax Status
--------------------------------------------------------------------------------
Note: The following description is based upon the Insurance Company's
understanding of current federal income tax law applicable to annuities in
general. The Insurance Company cannot predict the probability that any changes
in such laws will be made. Purchasers are cautioned to seek competent tax advice
regarding the possibility of such changes. The Insurance Company does not
guarantee the tax status of the Contracts. Purchasers bear the complete risk
that the Contracts may not be treated as "annuity contracts" under federal
income tax laws. It should be further understood that the following discussion
is not exhaustive and that special rules not described herein may be applicable
in certain situations. Moreover, no attempt has been made to consider any
applicable state or other tax laws.
General
Section 72 of the Internal Revenue Code of 1986, as amended ("Code") governs
taxation of annuities in general. A Contract Owner is not taxed on increases in
the value of a Contract until distribution occurs, either in the form of a lump
sum payment or as annuity payments under the Annuity Option elected. For a lump
sum payment received as a total surrender (total redemption) or death benefit,
the recipient is taxed on the portion of the payment that exceeds the cost basis
of the Contract. For Non-Qualified Contracts, this cost basis is generally the
purchase payments, while for Qualified Contracts there may be no cost basis. The
taxable portion of the lump sum payment is taxed at ordinary income tax rates.
For annuity payments, a portion of each payment in excess of an exclusion amount
is includible in taxable income. The exclusion amount for payments based on a
fixed annuity option is determined by multiplying the payment by the ratio that
the cost basis of the Contract (adjusted for any period certain or refund
feature) bears to the expected return under the Contract. The exclusion amount
for payments based on a variable annuity option is determined by dividing the
cost basis of the Contract (adjusted for any period certain or refund guarantee)
by the number of years over which the annuity is expected to be paid. Payments
received after the investment in the Contract has been recovered (i.e. when the
total of the excludible amounts equal the investment in the Contract) are fully
taxable. The taxable portion is taxed at ordinary income rates. For certain
types of Qualified Plans there may be no cost basis in the Contract within the
meaning of Section 72 of the Code. Contract Owners, annuitants and beneficiaries
under the Contracts should seek competent financial advice about the tax
consequences of any distributions.
The Insurance Company is taxed as a life insurance company under the Code. For
federal income tax purposes, the Separate Account is not a separate entity from
the Insurance Company, and its operations form a part of the Insurance Company.
Diversification
Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not adequately
diversified in accordance with regulations prescribed by the United States
Treasury Department ("Treasury Department"). Disqualification of the Contract as
an annuity contract would result in imposition of federal income tax to the
Contract Owner with respect to earnings allocable to the Contract prior to the
receipt of payments under the Contract. The Code contains a safe harbor
provision which provides that annuity contracts such as the Contracts meet the
diversification requirements if, as of the end of each quarter, the underlying
assets meet the diversification standards for a regulated investment company and
no more than fifty-five percent (55%) of the total assets consist of cash, cash
items, U.S. government securities and securities of other regulated investment
companies.
On March 2, 1989, the Treasury Department issued regulations (Treas. Reg.
1.817-5) which established diversification requirements for the investment
portfolios underlying variable contracts such as the Contracts. The regulations
amplify the diversification requirements for variable contracts set forth in the
Code and provide an alternative to the safe harbor provision described above.
Under the regulations, an investment portfolio will be deemed adequately
diversified if: (1) no more than 55% of the value of the total assets of the
portfolio is represented by any one investment; (2) no more than 70% of the
value of the total assets of the portfolio is represented by any two
investments; (3) no more than 80% of the value of the total assets of the
portfolio is represented by any three investments; and (4) no more than 90% of
the value of the total assets of the portfolio is represented by any four
investments.
The Code provides that for purposes of determining whether or not the
diversification standards imposed on the underlying assets of variable contracts
by Section 817(h) of the Code have been met, "each United States government
agency or instrumentality shall be treated as a separate issuer." The Insurance
Company intends that all Portfolios underlying the Contracts will be managed by
the investment advisers in such a manner as to comply with these diversification
requirements.
The Treasury Department has indicated that the diversification Regulations do
not provide guidance regarding the circumstances in which Contract Owner control
of the investments of the Separate Account will cause the Contract Owner to be
treated as the owner of the assets of the Separate Account, thereby resulting in
the loss of favorable tax treatment for the Contract. At this time it cannot be
determined whether additional guidance will be provided and what standards may
be contained in such guidance.
The amount of Contract Owner control which may be exercised under the Contract
is different in some respects from the situations addressed in published rulings
issued by the Internal Revenue Service in which it was held that the policy
owner was not the owner of the assets of the separate account. It is unknown
whether these differences, such as the Contract Owner's ability to transfer
among investment choices or the number and type of investment choices available,
would cause the Contract Owner to be considered as the owner of the assets of
the Separate Account resulting in the imposition of federal income tax to the
Contract Owner with respect to earnings allocable to the Contract prior to
receipt of payments under the Contract.
In the event any forthcoming guidance or ruling is considered to set forth a new
position, such guidance or ruling will generally be applied only prospectively.
However, if such ruling or guidance was not considered to set forth a new
position, it may be applied retroactively resulting in the Contract Owner being
retroactively determined to be the owner of the assets of the Separate Account.
Due to the uncertainty in this area, the Insurance Company reserves the right to
modify the Contract in an attempt to maintain favorable tax treatment.
Multiple Contracts
The Code provides that multiple non-qualified annuity contracts which are issued
within a calendar year period to the same contract owner by one company or its
affiliates are treated as one annuity contract for purposes of determining the
tax consequences of any distribution. Such treatment may result in adverse tax
consequences, including more rapid taxation of the distributed amounts from such
combination of contracts. For purposes of this rule, contracts received in a
Section 1035 exchange will be considered issued in the year of the exchange.
Contract Owners should consult a tax adviser prior to purchasing more than one
non-qualified annuity contract in any calendar year period.
Partial 1035 Exchanges
Section 1035 of the Code provides that an annuity contract may be exchanged in
a tax-free transaction for another annuity contract. Historically, it was
presumed that only the exchange of an entire contract, as opposed to a
partial exchange, would be accorded tax-free status. In 1998 in CONWAY VS.
COMMISSIONER, the Tax Court held that the direct transfer of a portion of
an annuity contract into another annuity contract qualified as a non-taxable
exchange. On November 22, 1999, the Internal Revenue Service filed an Action
on Decision which indicated that it acquiesced in the Tax Court decision in
CONWAY. However, in its acquiescence with the decision of the Tax Court, the
Internal Revenue Service stated that it will challenge transactions where
taxpayers enter into a series of partial exchanges and annuitizations as part
of a design to avoid application of the 10% premature distribution penalty or
other limitations imposed on annuity contracts under the Code. In the absence
of further guidance from the Internal Revenue Service it is unclear what
specific types of partial exchange designs and transactions will be challenged
by the Internal Revenue Service. Due to the uncertainty in this area owners
should consult their own tax advisers prior to entering into a partial exchange
of an annuity contract.
Contracts Owned by Other
than Natural Persons
Under Section 72(u) of the Code, the investment earnings on purchase payments
for the Contracts will be taxed currently to the Contract Owner if the Owner is
a non-natural person, e.g., a corporation or certain other entities. Such
Contracts generally will not be treated as annuities for federal income tax
purposes. However, this treatment is not applied to Contracts held by a trust or
other entity as an agent for a natural person nor to Contracts held by qualified
plans. Purchasers should consult their own tax counsel or other tax adviser
before purchasing a Contract to be owned by a non-natural person.
Tax Treatment of Assignments
An assignment or pledge of a Contract may be a taxable event. Contract Owners
should therefore consult competent tax advisers should they wish to assign or
pledge their Contracts. Death Benefits
Any death benefits paid under the Contract are taxable to the beneficiary. The
rules governing the taxation of payments from an annuity contract, as discussed
above, generally apply to the payment of death benefits and depend on whether
the death benefits are paid as a lump sum or as annuity payments. Estate taxes
may also apply.
Income Tax Withholding
All distributions or the portion thereof which is includible in the gross income
of the Contract Owner are subject to federal income tax withholding. Generally,
amounts are withheld from periodic payments at the same rate as wages and at the
rate of 10% from non-periodic payments. However, the Contract Owner, in most
cases, may elect not to have taxes withheld or to have withholding done at a
different rate.
Certain distributions from retirement plans qualified under Section 401 or
Section 403(b) of the Code, which are not directly rolled over to another
eligible retirement plan or individual retirement account or individual
retirement annuity, are subject to a mandatory 20% withholding for federal
income tax. The 20% withholding requirement generally does not apply to: (a) a
series of substantially equal payments made at least annually for the life or
life expectancy of the participant or joint and last survivor expectancy of the
participant and a designated beneficiary, or for a specified period of 10 years
or more; or (b) distributions which are required minimum distributions; or (c)
the portion of the distributions not includible in gross income (i.e. returns of
after-tax contributions); or (d) hardship withdrawals. Participants should
consult their own tax counsel or other tax adviser regarding withholding
requirements.
Tax Treatment of Withdrawals -
Non-Qualified Contracts
Section 72 of the Code governs treatment of distributions from annuity
contracts. It provides that if the contract value exceeds the aggregate purchase
payments made, any amount surrendered will be treated as coming first from the
earnings and then, only after the income portion is exhausted, as coming from
the principal. Withdrawn earnings are includable in gross income. It further
provides that a ten percent (10%) penalty will apply to the income portion of
any distribution. However, the penalty is not imposed on amounts received: (a)
after the taxpayer reaches age 59 1/2 ; (b) after the death of the Contract
Owner; (c) if the taxpayer is totally disabled (for this purpose disability is
as defined in Section 72(m)(7) of the Code); (d) in a series of substantially
equal periodic payments made not less frequently than annually for the life (or
life expectancy) of the taxpayer or for the joint lives (or joint life
expectancies) of the taxpayer and his beneficiary; (e) under an immediate
annuity; or (f) which are allocable to purchase payments made prior to August
14, 1982.
With respect to (d) above, if the series of substantially equal periodic
payments is modified before the later of your attaining age 59 1/2 or 5 years
from the date of the first periodic payment, then the tax for the year of the
modification is increased by an amount equal to the tax which would have been
imposed (the 10% penalty tax) but for the exception, plus interest for the tax
years in which the exception was used.
The above information does not apply to Qualified Contracts. However, separate
tax withdrawal penalties and restrictions may apply to such Qualified Contracts.
(See "Tax Treatment of Withdrawals"- Qualified Contracts.")
Qualified Plans
The Contracts offered by the Prospectus are designed to be suitable for use
under various types of Qualified Plans. Because of the minimum purchase payment
requirements, these Contracts may not be appropriate for some periodic payment
retirement plans. Taxation of participants in each Qualified Plan varies with
the type of plan and terms and conditions of each specific plan. Contract
Owners, Annuitants and beneficiaries are cautioned that benefits under a
Qualified Plan may be subject to the terms and conditions of the plan regardless
of the terms and conditions of the Contracts issued pursuant to the plan. Some
retirement plans are subject to distribution and other requirements that are not
incorporated into the Insurance Company's administrative procedures. The Company
is not bound by the terms and conditions of such plans to the extent such terms
conflict with the terms of a Contract, unless the Company specifically consents
to be bound. Contract Owners, participants and beneficiaries are responsible for
determining that contributions, distributions and other transactions with
respect to the Contracts comply with applicable law.
A Qualified Contract will not provide any necessary or additional tax deferral
if it is used to fund a Qualified Plan that is tax deferred. However, the
Contract has features and benefits other than tax deferral that may make it an
appropriate investment for a Qualified Plan. Following are general descriptions
of the types of Qualified Plans with which the Contracts may be used. Such
descriptions are not exhaustive and are for general informational purposes only.
The tax rules regarding Qualified Plans are very complex and will have differing
applications, depending on individual facts and circumstances. Each purchaser
should obtain competent tax advice prior to purchasing a Contract issued under a
Qualified Plan.
On July 6, 1983, the Supreme Court decided in Arizona Governing Committee v.
Norris that optional annuity benefits provided under an employer's deferred
compensation plan could not, under Title VII of the Civil Rights Act of 1964,
vary between men and women. The Contracts sold by the Insurance Company in
connection with Qualified Plans will utilize annuity tables which do not
differentiate on the basis of sex. Such annuity tables will also be available
for use in connection with certain non-qualified deferred compensation plans.
Contracts issued pursuant to Qualified Plans include special provisions
restricting Contract provisions that may otherwise be available and described in
this Statement of Additional Information. Generally, Contracts issued pursuant
to Qualified Plans are not transferable except upon surrender or annuitization.
Various penalty and excise taxes may apply to contributions or distributions
made in violation of applicable limitations. Furthermore, certain withdrawal
penalties and restrictions may apply to withdrawals from Qualified Contracts.
(See "Tax Treatment of Withdrawals - Qualified Contracts.")
a. Tax-Sheltered Annuities
Section 403(b) of the Code permits the purchase of "tax-sheltered annuities" by
public schools and certain charitable, educational and scientific organizations
described in Section 501(c)(3) of the Code. These qualifying employers may make
contributions to the Contracts for the benefit of their employees. Such
contributions are not includible in the gross income of the employee until the
employee receives distributions from the Contract. The amount of contributions
to the tax-sheltered annuity is limited to certain maximums imposed by the Code.
Furthermore, the Code sets forth additional restrictions governing such items as
transferability, distributions, nondiscrimination and withdrawals. (See "Tax
Treatment of Withdrawals - Qualified Contracts" and "Tax-Sheltered Annuities -
Withdrawal Limitations.") Employee loans are not allowed under these Contracts.
Any employee should obtain competent tax advice as to the tax treatment and
suitability of such an investment.
b. Individual Retirement Annuities
Section 408(b) of the Code permits eligible individuals to contribute to an
individual retirement program known as an "Individual Retirement Annuity"
("IRA"). Under applicable limitations, certain amounts may be contributed to an
IRA which may be deductible from the individual's taxable income. These IRAs are
subject to limitations on eligibility, contributions, transferability and
distributions. (See "Tax Treatment of Withdrawals - Qualified Contracts.") Under
certain conditions, distributions from other IRAs and other Qualified Plans may
be rolled over or transferred on a tax-deferred basis into an IRA. Sales of
Contracts for use with IRAs are subject to special requirements imposed by the
Code, including the requirement that certain informational disclosure be given
to persons desiring to establish an IRA. Purchasers of Contracts to be qualified
as Individual Retirement Annuities should obtain competent tax advice as to the
tax treatment and suitability of such an investment.
Roth IRAs
Section 408A of the Code provides that beginning in 1998, individuals may
purchase a new type of non-deductible IRA, known as a Roth IRA. Purchase
payments for a Roth IRA are limited to a maximum of $2,000 per year and are not
deductible from taxable income. Lower maximum limitations apply to individuals
with adjusted gross incomes between $95,000 and $110,000 in the case of single
taxpayers, between $150,000 and $160,000 in the case of married taxpayers filing
joint returns, and between $0 and $10,000 in the case of married taxpayers
filing separately. An overall $2,000 annual limitation continues to apply to all
of a taxpayer's IRA contributions, including Roth IRA and non-Roth IRAs.
Qualified distributions from Roth IRAs are free from federal income tax. A
qualified distribution requires that an individual has held the Roth IRA for at
least five years and, in addition, that the distribution is made either after
the individual reaches age 59 1/2, on the individual's death or disability, or
as a qualified first-time home purchase, subject to a $10,000 lifetime maximum,
for the individual, a spouse, child, grandchild, or ancestor. Any distribution
which is not a qualified distribution is taxable to the extent of earnings in
the distribution. Distributions are treated as made from contributions first and
therefore no distributions are taxable until distributions exceed the amount of
contributions to the Roth IRA. The 10% penalty tax and the regular IRA
exceptions to the 10% penalty tax apply to taxable distributions from a Roth
IRA.
Amounts may be rolled over from one Roth IRA to another Roth IRA. Furthermore,
an individual may make a rollover contribution from a non-Roth IRA to a Roth
IRA, unless the individual has adjusted gross income over $100,000 or the
individual is a married taxpayer filing a separate return. The individual must
pay tax on any portion of the IRA being rolled over that represents income or a
previously deductible IRA contribution. However, for rollovers in 1998, the
individual may pay that tax ratably over the four taxable year periods beginning
with tax year 1998.
Purchasers of Contracts to be qualified as a Roth IRA should obtain competent
tax advice as to the tax treatment and suitability of such an investment.
c. Pension and Profit-Sharing Plans
Sections 401(a) and 401(k) of the Code permit employers, including self-employed
individuals, to establish various types of retirement plans for employees. These
retirement plans may permit the purchase of the Contracts to provide benefits
under the Plan. Contributions to the Plan for the benefit of employees will not
be includible in the gross income of the employee until distributed from the
Plan. The tax consequences to participants may vary, depending upon the
particular Plan design. However, the Code places limitations and restrictions on
all Plans, including on such items as: amount of allowable contributions; form,
manner and timing of distributions; transferability of benefits; vesting and
nonforfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions and withdrawals.
Participant loans are not allowed under the Contracts purchased in connection
with these Plans. (See "Tax Treatment of Withdrawals - Qualified Contracts.")
Purchasers of Contracts for use with Pension or Profit-Sharing Plans should
obtain competent tax advice as to the tax treatment and suitability of such an
investment.
Tax Treatment of Withdrawals -
Qualified Contracts
In the case of a withdrawal under a Qualified Contract, a ratable portion of the
amount received is taxable, generally based on the ratio of the individual's
cost basis to the individual's total accrued benefit under the retirement plan.
Special tax rules may be available for certain distributions from a Qualified
Contract. Section 72(t) of the Code imposes a 10% penalty tax on the taxable
portion of any distribution from qualified retirement plans, including Contracts
issued and qualified under Code Sections 401 (Pension and Profit-Sharing Plans),
403(b) (Tax-Sheltered Annuities) and 408 and 408A (Individual Retirement
Annuities). To the extent amounts are not includible in gross income because
they have been properly rolled over to an IRA or to another eligible Qualified
Plan, no tax penalty will be imposed. The tax penalty will not apply to the
following distributions: (a) if distribution is made on or after the date on
which the Contract Owner or Annuitant (as applicable) reaches age 59 1/2; (b)
distributions following the death or disability of the Contract Owner or
Annuitant (as applicable) (for this purpose disability is as defined in Section
72(m)(7) of the Code); (c) after separation from service, distributions that are
part of substantially equal periodic payments made not less frequently than
annually for the life (or life expectancy) of the Contract Owner or Annuitant
(as applicable) or the joint lives (or joint life expectancies) of such Contract
Owner or Annuitant (as applicable) and his or her designated beneficiary; (d)
distributions to a Contract Owner or Annuitant (as applicable) who has separated
from service after he or she has attained age 55; (e) distributions made to the
Contract Owner or Annuitant (as applicable) to the extent such distributions do
not exceed the amount allowable as a deduction under Code Section 213 to the
Contract Owner or Annuitant (as applicable) for amounts paid during the taxable
year for medical care; (f) distributions made to an alternate payee pursuant to
a qualified domestic relations order; (g) distributions made on account of an
IRS levy upon the Qualified Contract; (h) distributions from an Individual
Retirement Annuity for the purchase of medical insurance (as described in
Section 213(d)(1)(D) of the Code) for the Contract Owner or Annuitant (as
applicable) and his or her spouse and dependents if the Contract Owner or
Annuitant (as applicable) has received unemployment compensation for at least 12
weeks (this exception no longer applies after the Contract Owner or Annuitant
(as applicable) has been re-employed for at least 60 days); (i) distributions
from an Individual Retirement Annuity made to the Owner or Annuitant (as
applicable) to the extent such distributions do not exceed the qualified higher
education expenses (as defined in Section 72(t)(7) of the Code) of the Owner or
Annuitant (as applicable) for the taxable year; and (j) distributions from an
Individual Retirement Annuity made to the Owner or Annuitant (as applicable)
which are qualified first-time home buyer distributions (as defined in Section
72(t)(8) of the Code). The exceptions stated in items (d) and (f) above do not
apply in the case of an Individual Retirement Annuity. The exception stated in
item (c) applies to an Individual Retirement Annuity without the requirement
that there be a separation from service.
With respect to (c) above, if the series of substantially equal periodic
payments is modified before the later of your attaining age 59 1/2 or 5 years
from the date of the first periodic payment, then the tax for the year of the
modification is increased by an amount equal to the tax which would have been
imposed (the 10% penalty tax) but for the exception, plus interest for the tax
years in which the exception was used.
Generally, distributions from a Qualified Plan must commence no later than April
1 of the calendar year following the later of: (a) the year in which the
employee attains age 70 1/2, or (b) the calendar year in which the employee
retires. The date set forth in (b) does not apply to an Individual Retirement
Annuity. Required distributions must be over a period not exceeding the life
expectancy of the individual or the joint lives or life expectancies of the
individual and his or her designated beneficiary. If the required minimum
distributions are not made, a 50% penalty tax is imposed as to the amount not
distributed.
Tax-Sheltered Annuities - Withdrawal Limitations
The Code limits the withdrawal of amounts attributable to contributions made
pursuant to a salary reduction agreement (as defined in Section 403(b)(11) of
the Code) to circumstances only when the Contract Owner: (1) attains age 59 1/2;
(2) separates from service; (3) dies; (4) becomes disabled (within the meaning
of Section 72(m)(7) of the Code); or (5) in the case of hardship. However,
withdrawals for hardship are restricted to the portion of the Contract Owner's
Contract Value which represents contributions by the Contract Owner and does not
include any investment results. The limitations on withdrawals became effective
on January 1, 1989, and apply only to salary reduction contributions made after
December 31, 1988, and to income attributable to such contributions and to
income attributable to amounts held as of December 31, 1988. The limitations on
withdrawals do not affect rollovers and transfers between certain Qualified
Plans. Contract Owners should consult their own tax counsel or other tax adviser
regarding any distributions.
Annuity Provisions
-------------------------------------------------------------------------------
Fixed Annuity Payout
A fixed annuity is an annuity with payments which are guaranteed as to dollar
amount by the Insurance Company and do not vary with the investment experience
of a Portfolio. The Fixed Account value on the day immediately preceding the
Income Date will be used to determine the Fixed Annuity monthly payment. The
monthly Annuity Payment will be based upon the Contract Value at the time of
annuitization, the Annuity Option selected, the age of the Annuitant and any
joint Annuitant and the sex of the Annuitant and joint Annuitant where allowed.
Variable Annuity Payout
A variable annuity is an annuity with payments which: (1) are not predetermined
as to dollar amount; and (2) will vary in amount with the net investment results
of the applicable Portfolio(s).
Annuity Unit Value
On the Income Date, a fixed number of Annuity Units will be purchased as
follows:
The first Annuity Payment is equal to the Adjusted Contract Value, divided first
by $1,000 and then multiplied by the appropriate Annuity Payment amount for each
$1,000 of value for the Annuity Option selected. In each Portfolio the fixed
number of Annuity Units is determined by dividing the amount of the initial
Annuity Payment determined for each Portfolio by the Annuity Unit value on the
Income Date. Thereafter, the number of Annuity Units in each Portfolio remains
unchanged unless the Contract Owner elects to transfer between Portfolios. All
calculations will appropriately reflect the Annuity Payment frequency selected.
On each subsequent Annuity Payment date, the total Annuity Payment is the sum of
the Annuity Payments for each Portfolio. The Annuity Payment in each Portfolio
is determined by multiplying the number of Annuity Units then allocated to such
Portfolio by the Annuity Unit value for that Portfolio.
On each subsequent Valuation Date, the value of an Annuity Unit is determined in
the following way:
First: The Net Investment Factor is determined as described in the Prospectus
under "Purchase - Accumulation Units."
Second: The value of an Annuity Unit for a Valuation Period is equal to:
a. the value of the Annuity Unit for the immediately preceding Valuation Period.
b. multiplied by the Net Investment Factor for the current Valuation Period;
c. divided by the Assumed Net Investment Factor (see below) for the Valuation
Period.
The Assumed Net Investment Factor is equal to one plus the Assumed Investment
Return which is used in determining the basis for the purchase of an Annuity,
adjusted to reflect the particular Valuation Period. The Assumed Investment
Return that the Insurance Company will use is 5%. However, the Insurance Company
may agree to use a different value.
Mortality and Expense Risk Guarantee
--------------------------------------------------------------------------------
The Insurance Company guarantees that the dollar amount of each Annuity Payment
after the first Annuity Payment will not be affected by variations in mortality
and expense experience.
Financial Statements
-------------------------------------------------------------------------------
The audited consolidated financial statements of the Insurance Company as of and
for the year ended December 31, 1999, included herein should be considered only
as bearing upon the ability of the Insurance Company to meet its obligations
under the Contracts. The audited financial statements of the Separate Account as
of and for the year ended December 31, 1999, are also included herein.
(Financial statements will be filed by Amendment)
PART C
OTHER INFORMATION
Item 24. Financial Statements and Exhibits
a. Financial Statements
The financial statements of the Company and the Separate Account will
be filed by Amendment.
b. Exhibits
1. Resolution of Board of Directors of the Company authorizing the
establishment of the Variable Account(1)
2. Not Applicable
3.a. Principal Underwriter's Agreement(2)
3.b. General Agency Agreement(4)
4. Individual Variable Annuity Contract
4.a. Waiver of Contingent Deferred Sales Charge Endorsement(1)
4.b. Enhanced Death Benefit Endorsements(1)
4.c. Immediate Bonus Endorsement
4.d. Loyalty Bonus Endorsement
4.e. Guaranteed Minimum Income Benefit Endorsement (Option 1)
4.f. Guaranteed Minimum Income Benefit Endorsement (Option 2)
5. Application for Individual Variable Annuity Contract
6. (i) Copy of Articles of Incorporation of the Company(1)
(ii) Copy of the Bylaws of the Company(1)
7. Not Applicable
8.a. Form of Fund Participation Agreement between North American
Life and Casualty Company and Franklin Valuemark Funds(1)
8.b. Form of Fund Participation Agreement between AIM Variable
Insurance Funds, Inc., Allianz Life Insurance Company of North
America and NALAC Financial Plans LLC(3)
8.c. Form of Fund Participation Agreement between The Alger American
Fund, Allianz Life Insurance Company of North America and Fred
Alger & Company, Incorporated(3)
8.d. Form of Fund Participation Agreement between USAllianz Variable
Insurance Products Trust, Allianz Life Insurance Company of
North America and BISYS Fund Services Limited Partnership(3)
9. Opinion and Consent of Counsel (to be filed by amendment)
10. Independent Auditors' Consent (to be filed by amendment)
11. Not Applicable
12. Not Applicable
13. Calculation of Performance Data (to be filed by amendment)
14. Company Organizational Chart(4)
27. Not Applicable
(1) Incorporated by reference to Registrant's Form N-4 (File Nos. 333-06709
and 811-05618) electronically filed on June 24, 1996.
(2) Incorporated by reference to Pre-Effective Amendment No. 1 to Registrant's
Form N-4 (File Nos. 333-06709 and 811-05618) electronically filed on
December 13, 1996.
(3) Incorporated by reference to Registrant's Form N-4 (File Nos. 333-06709 and
811-05618) electronically filed on November 12, 1999.
(4) Incorporated by reference to Registrant's Post-Effective Amendment No. 8
to Form N-4 (File Nos. 333-06709 and 811-05618) electronically filed on
April 27, 2000.
Item 25. Directors and Officers of the Depositor
The following are the Officers and Directors of the Insurance Company:
<TABLE>
<CAPTION>
<S> <C>
Name and Principal Positions and Offices
Business Address with Depositor
---------------------------- ---------------------------------
Robert W. MacDonald Director,
300 S. Hwy 169 Chief Executive Officer
Minneapolis, MN 55426
Margery G. Hughes President,
300 S. Hwy 169 Chief Administrative Officer
Minneapolis, MN 55426
Mark A. Zesbaugh Senior Vice President,
300 S. Hwy 169 Chief Financial Officer
Minneapolis, MN 55426
Lowell C. Anderson Chairman of the Board
1750 Hennepin Avenue
Minneapolis, MN 55403
Herbert F. Hansmeyer Director
777 San Marin Drive
Novato, CA 94998
Michael P. Sullivan Director
7505 Metro Boulevard
Minneapolis, MN 55439
Dr. Gerhard Rupprecht Director
Reinsburgstrasse 19
D-70178
Stuttgart, Germany
Edward J. Bonach President - Special
1750 Hennepin Avenue Markets Division
Minneapolis, MN 55403
Robert S. James Senior Vice President - Marketing
300 S. Hwy 169 Development
Minneapolis, MN 55426
Rev. Dennis Dease Director
c/o University of St. Thomas
215 Summit Avenue
St. Paul, MN 55105-1096
James R. Campbell Director
c/o Norwest Corp.
Norwest Center
Sixth & Marquette
Minneapolis, MN 55479-0116
Robert M. Kimmitt Director
Wilmer, Cutler & Pickering
2445 M Street NW
Washington, DC 20037-1420
Brad Barks Senior Vice President -
300 S. Hwy 169 Financial Analysis/M&A
Minneapolis, MN 55426
Chuck Kavitsky Senior Vice President -
300 S. Hwy 169 Chief Marketing Officer
Minneapolis, MN 55426
</TABLE>
Item 26. Persons Controlled by or Under Common Control with the Depositor
or Registrant
The Insurance Company organizational chart was filed as Exhibit 14 (File
Nos. 333-06709 and 811-05618) in Post-Effective Amendment No. 8 filed
April 27, 2000 and is incorporated herein by reference.
Item 27. Number of Contract Owners
Not Applicable
Item 28. Indemnification
The Bylaws of the Insurance Company provide that:
Each person (and the heirs, executors, and administrators of such person) made
or threatened to be made a party to any action, civil or criminal, by reason of
being or having been a Director, officer, or employee of the corporation (or by
reason of serving any other organization at the request of the corporation)
shall be indemnified to the extent permitted by the laws of the State of
Minnesota, and in the manner prescribed therein.
Insofar as indemnification for liability arising under the Securities Act of
1933 may be permitted for directors and officers or controlling persons of the
Insurance Company pursuant to the foregoing, or otherwise, the Insurance Company
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Insurance Company of expenses
incurred or paid by a director, officer or controlling person of the Insurance
Company in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the
securities being registered, the Company will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
Item 29. Principal Underwriters
a. USAllianz Investor Services, LLC is the principal underwriter
for the Contracts. It also is the principal underwriter for:
Allianz Life Variable Account A
Preferred Life Variable Account C
b. The following are the officers(managers) and directors (Board of
Governors) of USAllianz Investor Services, LLC:
<TABLE>
<CAPTION>
<S> <C>
Positions and Offices
Business Address with Underwriter
---------------------- ----------------------
Christopher H.Pinkerton President and Director
1750 Hennepin Avenue
Minneapolis, MN 55403
Thomas B. Clifford Vice President and Director
1750 Hennepin Avenue
Minneapolis, MN 55403
Catherine L. Mielke Compliance Officer
1750 Hennepin Avenue
Minneapolis, MN 55403
Michael M. Ahles Senior Vice President, Chief Financial
1750 Hennepin Avenue Officer & Treasurer
Minneapolis, MN 55403
Lawrance C. Skibo Executive Vice President
1750 Hennepin Avenue
Minneapolis, MN 55403
Catherine Q. Farley Senior Vice President & Chief Administrative
1750 Hennepin Avenue Officer
Minneapolis, MN 55403
Robert S. James Director
1750 Hennepin Avenue
Minneapolis, MN 55403
Cindy Robeck Assistant Vice President
1750 Hennepin Avenue
Minneapolis, MN 55403
Carol Shaw Senior Vice President
1750 Hennepin Avenue
Minneapolis, MN 55403
Gigi Wagner Vice President
1750 Hennepin Avenue
Minneapolis, MN 55403
</TABLE>
c. Not Applicable
Item 30. Location of Accounts and Records
Thomas Clifford, whose address is 1750 Hennepin Avenue, Minneapolis, Minnesota,
55403 and Delaware Valley Financial Services, USAllianz Service Center, 300
Berwyn Park, Berwyn, Pennsylvania 19312, maintain physical possession of the
accounts, books or documents of the Variable Account required to be maintained
by Section 31(a) of the Investment Company Act of 1940, as amended, and the
rules promulgated thereunder.
Item 31. Management Services
Not Applicable
Item 32. Undertakings
a. Registrant hereby undertakes to file a post-effective amendment to this
registration statement as frequently as is necessary to ensure that the audited
financial statements in the registration statement are never more than sixteen
(16) months old for so long as payment under the variable annuity contracts may
be accepted.
b. Registrant hereby undertakes to include either (1) as part of any
application to purchase a contract offered by the Prospectus, a space that an
applicant can check to request a Statement of Additional Information, or (2) a
postcard or similar written communication affixed to or included in the
Prospectus that the applicant can remove to send for a Statement of Additional
Information.
c. Registrant hereby undertakes to deliver any Statement of Additional
Information and any financial statements required to be made available under
this Form promptly upon written or oral request.
d. Allianz Life Insurance Company of North America ("Company") hereby
represents that the fees and charges deducted under the Contract described in
the Prospectus, in the aggregate, are reasonable in relation to the services
rendered, the expenses to be incurred and the risks assumed by the Company.
REPRESENTATIONS
The Insurance Company hereby represents that it is relying upon a No Action
Letter issued to the American Council of Life Insurance, dated November 28, 1988
(Commission ref. IP-6-88), and that the following provisions have been complied
with:
1. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in each registration statement, including the
prospectus, used in connection with the offer of the contract;
2. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in any sales literature used in connection with
the offer of the contract;
3. Instruct sales representatives who solicit participants to purchase the
contract specifically to bring the redemption restrictions imposed by Section
403(b)(11) to the attention of the potential participants;
4. Obtain from each plan participant who purchases a Section 403(b) annuity
contract, prior to or at the time of such purchase, a signed statement
acknowledging the participant's understanding of (1) the restrictions on
redemption imposed by Section 403(b)(11), and (2) other investment alternatives
available under the employer's Section 403(b) arrangement to which the
participant may elect to transfer his contract value.
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act of
1940, as amended, the Registrant has caused this Registration Statement to be
signed on its behalf in the City of Minneapolis and State of Minnesota, on this
29th day of June, 2000.
ALLIANZ LIFE VARIABLE ACCOUNT B
(Registrant)
By: ALLIANZ LIFE INSURANCE COMPANY
OF NORTH AMERICA
(Depositor)
By: /S/ SUZANNE J. PEPIN
--------------------------------
ALLIANZ LIFE INSURANCE COMPANY
OF NORTH AMERICA
(Depositor)
By: /S/ SUZANNE J. PEPIN
------------------------------
Pursuant to the requirements of the Securities Act of 1933, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
Signature and Title Date
<TABLE>
<CAPTION>
<S> <C> <C>
Lowell C. Anderson* Chairman of the Board 6/29/00
Lowell C. Anderson
Robert W. MacDonald* Director and 6/29/00
Robert W. MacDonald Chief Executive Officer
Margery G. Hughes* President and 6/29/00
Margery G. Hughes Chief Administrative Officer
Mark A. Zesbaugh* Chief Financial Officer 6/29/00
Mark A. Zesbaugh Senior Vice President
Herbert F. Hansmeyer* Director 6/29/00
Herbert F. Hansmeyer
Michael P. Sullivan* Director 6/29/00
Michael P. Sullivan
Dr. Gerhard Rupprecht* Director 6/29/00
Dr. Gerhard Rupprecht
Rev. Dennis Dease* Director 6/29/00
Rev. Dennis Dease
James R. Campbell* Director 6/29/00
James R. Campbell
Robert M. Kimmitt* Director 6/29/00
Robert M. Kimmitt
</TABLE>
*By Power of Attorney
By: /S/ SUZANNE J. PEPIN
--------------------------------
Suzanne J. Pepin
Attorney-in-Fact
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Lowell C. Anderson, Chairman of
the Board of Allianz Life Insurance Company of North America (Allianz Life), a
corporation duly organized under the laws of Minnesota, do hereby appoint Robert
W. MacDonald and Suzanne J. Pepin, each individually as my attorney and agent,
for me, and in my name as Chairman of the Board of Allianz Life on behalf of
Allianz Life, with full power to execute, deliver and file with the Securities
and Exchange Commission all documents required for registration of a security
under the Securities Act of 1933, as amended, and the Investment Company Act of
1940, as amended, and to do and perform each and every act that said attorney
may deem necessary or advisable to comply with the intent of aforesaid Acts.
WITNESS my hand and seal this 3rd day of April 2000.
WITNESS:
/s/ Lowell C. Anderson
-----------------------------
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Robert W. MacDonald, Chief
Executive Officer and a Director of Allianz Life Insurance Company of North
America (Allianz Life), a corporation duly organized under the laws of
Minnesota, do hereby appoint Suzanne J. Pepin as my attorney and agent, for me,
and in my name as Chief Executive Officer and Director of Allianz Life on behalf
of Allianz Life, with full power to execute, deliver and file with the
Securities and Exchange Commission all documents required for registration of a
security under the Securities Act of 1933, as amended, and the Investment
Company Act of 1940, as amended, and to do and perform each and every act that
said attorney may deem necessary or advisable to comply with the intent of
aforesaid Acts.
/s/ Robert W. MacDonald
-----------------------
Robert W. MacDonald
WITNESS my hand and seal this 26th day of April 2000.
WITNESS:
/s/ Mary Ann Lemke
-----------------------------
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Margery G. Hughes, President of
Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as President of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
WITNESS my hand and seal this 5th day of April 2000.
WITNESS: /s/ Mary Ann Lemke
/s/ Margery G. Hughes
-----------------------
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Mark A. Zesbaugh, Senior Vice
President, Chief Financial Officer and Assistant Secretary of Allianz Life
Insurance Company of North America (Allianz Life), a corporation duly organized
under the laws of Minnesota, do hereby appoint Robert W. MacDonald and Suzanne
J. Pepin, each individually as my attorney and agent, for me, and in my name as
Senior Vice President, Chief Financial Officer and Assistant Secretary of
Allianz Life on behalf of Allianz Life, with full power to execute, deliver and
file with the Securities and Exchange Commission all documents required for
registration of a security under the Securities Act of 1933, as amended, and the
Investment Company Act of 1940, as amended, and to do and perform each and every
act that said attorney may deem necessary or advisable to comply with the intent
of aforesaid Acts.
WITNESS my hand and seal this 3rd day of April 2000.
WITNESS: /s/ Mark A. Zesbaugh
/s/ Stacey R. Thiele
-----------------------
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Herbert F. Hansmeyer, Director of
Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as Director of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
/s/ Herbert F. Hansmeyer
------------------------
Herbert F. Hansmeyer
WITNESS my hand and seal this 4th day of April 2000.
WITNESS:
/s/ David C Marks
------------------
ACKNOWLEDGEMENT
State of Connecticut
County of Fairfield
The foregoing instrument was acknowledged before me Tracy Stroh this 5th day of
April, 2000, by Herbert F. Hansmeyer.
/s/ Tracey Stroh
-----------------
Notary Public
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Michael P. Sullivan, Director of
Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as Director of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
WITNESS my hand and seal this 5th day of April 2000.
WITNESS:
/s/ Michael P. Sullivan
------------------
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Dr. Gerhard G. Rupprecht, Director
of Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as Director of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
WITNESS my hand and seal this 18th day of April 2000.
WITNESS:
/s/ Gerhard Rupprecht
(Dr. Gerhard Rupprecht)
Unterschriftsbeglaubigung
I hereby certify, the the above is the true signature, acknowledged in my
presence of
Dr. Gerhard Rupprecht
Chairman of the Board of Management
Reinsburgstrabe 19,70178 Stuttgart, Germany,
Personally know to me.
Stuttgart, den 18.April 2000
/s/ Dr. Kubler
Dr. Kubler
Notarvetreter
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Reverand Dennis J. Dease, Director
of Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as Director of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
/s/ Dennis J. Dease
WITNESS my hand and seal this 4th day of April 2000.
WITNESS:
/s/ Donna L Baisden
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, James R. Campbell, Director of
Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as Director of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
/s/ James R. Campbell
WITNESS my hand and seal this 5th day of April 2000.
WITNESS:
/s/ Vicki L. Plymate
--------------------
LIMITED POWER OF ATTORNEY
KNOWN ALL MEN BY THESE PRESENTS, that I, Robert M. Kimmitt, Director of
Allianz Life Insurance Company of North America (Allianz Life), a corporation
duly organized under the laws of Minnesota, do hereby appoint Robert W.
MacDonald and Suzanne J. Pepin, each individually as my attorney and agent, for
me, and in my name as Director of Allianz Life on behalf of Allianz Life, with
full power to execute, deliver and file with the Securities and Exchange
Commission all documents required for registration of a security under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended, and to do and perform each and every act that said attorney may deem
necessary or advisable to comply with the intent of aforesaid Acts.
WITNESS my hand and seal this 5th day of April 2000.
/s/ Robert M. Kimmitt
----------------------
Robert M. Kimmitt, Esq.
WITNESS:
/s/ illegible
------------------
EXHIBITS
TO
FORM N-4
ALLIANZ LIFE VARIABLE ACCOUNT B
ALLIANZ LIFE INSURANCE COMPANY OF NORTH AMERICA
INDEX TO EXHIBITS
EXHIBIT
99.B.4. Individual Annuity Contract
99.B.4.c. Immediate Bonus Endorsement
99.B.4.d. Loyalty Bonus Endorsement
99.B.4.e. Guaranteed Minimum Income Benefit Endorsement (Option 1)
99.B.4.f. Guaranteed Minimum Income Benefit Endorsement (Option 2)
99.B.5. Application for Variable Annuity
